PVE Capital, a European credit investment firm, has bought a €408m portfolio of Italian non-performing loans, reports Private Debt Investor, our sister publication. The book comprises residential and commercial real estate loans, with the former making up around 75% of the assets, said Gennaro Pucci, founder of PVE Capital
PVE raised a new credit fund from third-party investors in just two weeks in January to support the purchase from a small Italian private bank, Pucci said. He declined to say what the total size of PVE European Credit Fund I is but explained that it holds between 20% and 30% of the Italian NPL portfolio.
“There’s a lot of interest for these kind of assets,” said Pucci. “They [investors] were ready, it was just up to us to source [the NPLs].”
The assets in the portfolio are geographically spread across Italy and most of the commercial real estate loans are secured against hotels or other tourism-related facilities. The average loan-to-value of the portfolio is between 70% and 80%.
Pucci, a structured credit specialist, is already working on two other NPL portfolio bids, and the firm has a target of purchasing €2bn in assets by the end of this year, Pucci said. PVE will invest in commercial real estate loans, but their focus is on residential asset purchases for the moment.
PVE Capital has also formed a strategic partnership with special situation servicer, Centaurus, the founder of which, Ubaldo Palmidoro, has worked with some of Italy’s largest loan management agencies. The master servicer for the Italian 130 Law vehicle that PVE created to hold the assets will be Prelios Credit Servicing, to meet all central bank reporting requirements.
At the loan level, however, Centaurus will provide a more bespoke management service. Pucci said that his firm had considered forming its own servicing manager but instead opted to team-up with Centaurus, which will service future NPL portfolios for PVE.
The €408m portfolio it has just bought will be wound down and assets sold off over the next four to five years, he added. London-based PVE Capital was established by Pucci in 2009 and manages $400 million in assets.