AstroBank (the “Bank”) announced that, following an international competitive bidding process, it reached an agreement, on 31st December 2019, with Qualco Holdco Limited, for the sale to the latter of 74.9% of Trusset Asset Management Limited (the “Company”), a newly formed company, for the management of AstroBank’s portfolio of Non Performing Exposures (“NPEs”) and Real Estate Owned Assets (“REOs”).
According to a statement, AstroBank will retain 25.1% of the Company. In the context of purchasing this business from AstroBank, the Company will employ from the Bank, through the TUPE Legislation, 37 employees who have to date been managing the specific portfolio. Further, the Company will purchase from AstroBank all related IT licences, processes, products and the collective expertise and processes of AstroBank for the management of the NPEs and REOs. It is emphasized that these portfolios continue to reside on the Bank’s balance sheet.
This transaction, which is part of AstroBank’s strategy to reduce NPEs in line with regulatory requirements, is expected to improve the Bank’s Capital Adequacy Ratio by approximately one percent, and is subject to a number of conditions including the approval of the Competition Authority in Cyprus.
This Joint Venture will combine the local knowledge and expertise of AstroBank with Qualco’s significant international capabilities, best practices and systems in Debt Recovery, to expand its current portfolio under management, in order to become a strong player in the Cypriot Market.
Since its establishment 20 years ago, Qualco Group, with headquarters in Athens and offices in the UK, France, Cyprus and Brazil, serves over 70 clients in more than 15 countries. In Greece it has become the leading independent servicer of non-performing exposures, with more than €10bn of Assets under Management ("AuM"), an additional €2.2bn in loan administration assets, and around €70bn of non- performing portfolios underwritten and valued. In the UK the Group has more than €10bn of AuMs, for leading financial institutions.
Mr OrestisTsakalotos, Chairman of Qualco, said “Our aim is to transfer and utilise the existing knowledge, capabilities and systems into the Cypriot Servicing market via Trusset Asset Management Limited, which will lay the base for the expansion of our servicing arm. We are very pleased that we will be working with AstroBank towards that goal”.
AstroBank Limited is a full-fledged Cypriot Bank regulated by the Central Bank of Cyprus and by the European Central Bank. The Bank commenced operations in 2008 as a wholly-owned subsidiary of Piraeus Bank S.A. by acquiring Arab Bank’s Cyprus Branch operations as well as Euroinvestment& Finance Plc. In December 2016 there was a change of ownership through a capital increase of the Bank by a group of international investors. On 30 March 2017, the Bank changed its name from Piraeus Bank (Cyprus) Ltd to AstroBank Limited. As of Q3 of 2019, the Bank’s financial statements (after Audit Review) showed Deposits of €2.1bn; Net Loans of €1bn; Equity of€186mm and Return of Equity of over 10%. Further, in November 2019, AstroBank Ltd and National Bank of Greece SA announced the signing of a Share and Purchase Agreement for the acquisition by AstroBank of NBG Cyprus Ltd. Thistransactionisexpected to becompletedby Q2, 2020.
Mr Constantinos Loizides, Chairman of the Executive Committee of AstroBank, said, “We are very excited by the prospect of Qualco’s internationally renowned expertise in Debt Recovery be applied to our NPE and REO portfolios. At the same time we also very much look forward to working closely with Qualco to further increase this Company’s activities in Cyprus”.
NatWest Markets acted as sole financial advisor to AstroBank while Akin Gump Strauss Hauer& Feld and KoushosKorfiotisPapacharalambous LLC acted as international and local external legal counsel respectively, whilst Georgiades and Pelides LLC and Allen and Overy LLP served as legal counsels to Qualco Holdco Limited and its financiers.