The Cyprus Asset Management Company’s (KEDIPES), a state-owned AMC, cash inflow declined to the lowest point since its inception, affected by Coronavirus pandemic.
According to a progress report for the second quarter of 2020, cash inflow declined to €53 million, marking a reduction of 32% over the previous quarter, affected by the measures to contain the coronavirus pandemic.
Revenue from asset management (loans and real estate) amounted to €50.9 million or 0.7% of the KEDIPES’ nominal portfolio value amounting to €7.58 billion in the end of Q1 2020. KEDIPES’ cash position amounted to €125.8 million at the end of June 2020.
KEDIPES which began operations in September 2018, is the residual entity following the acquisition of the state-owned Cyprus Cooperative Bank’s performing loan book by Hellenic Bank. The state-owned AMC is mandated to manage its portfolio, consisted of mainly non-performing loans, with a view to repay the €3.5 billion the state paid with in bid to facilitate the transaction.
Commenting on the results, Lambros Papadopoulos Chairman of KEDIPES Board of Directors said KEDIPES’ operations began recovering following the partial lifting of the two-month lock down in Cyprus, with cash receipts in June corresponding to 60% of the quarter’s total receipts, noting that receipts are expected to peak in the next quarter.
“The recovery continued with cash inflow in Q3 expected to exceed €80 million, the highest level this year, but will remain at lower levels by approximately 25% compared to 2019,” he said.
Papadopoulos also said the Board decided to pay the state with €40 million, with cash total payments made to the state against the state-aid amounting to €160 million in 2020 and €280 million since KEDIPES began operations.
Furthermore, KEDIPES also transferred to the state real estate amounting to €140 million as well as other assets such as art collections and coins collections totalling €1.3 billion, which will be deducted from the total state aid following their evaluation from the competent state services.
Assets under management in the end of the second quarter of 2020 amounted to €7,79 billion of which €162 million in cash, real estate of €648 million in nominal value and performing loans totalling €553.
Total loans (nominal value) rose to €6.94 billion in the second quarter compared with €6.91 billion in Q1 with the increase attributed to accrued interest which exceeded payments and write offs.
Total deleverage since the state-owned began operations amounts to 5.9%, while excluding accrued interest total deleverage amounted to 15.7%, KEDIPES said.