The latest data on Europe’s real estate debt deleveraging

Investment banking company Evercore recorded €63bn of legacy real estate loan and asset sales by the region's banks in 2019.

After a record year of real estate loan and bank-owned asset sales in 2018, European banks’ deleveraging activity was reduced in 2019.

According to investment banking company Evercore, which tracks the market on a quarterly basis, a total of €63 billion of real estate loan and real estate owned property was off-loaded by banks during the year.

The total, accounted for by 86 transactions, was down 45 percent year-on-year and was lower than the volumes achieved in four of the last five years. Southern Europe was the main focus, although Spain witnessed a notable decrease with just €9.5 billion of sales, compared to more than €40 billion in 2018.

Italy led the way in 2019, with €23 billion of sales, mainly involving securitisations. The UK and Ireland featured prominently, mainly due to sales of residential mortgage books.

Many had expected a significant increase in Greek loan sales, although only €4.8 billion traded, a modest increase from €3.2 billion in 2018. However, with an asset protection scheme, known as Hercules, now approved, activity is expected to increase in 2020.

Evercore reported almost €26 billion of live European transactions across 15 deals from 14 vendors, including eight portfolios with a face value of more than €1 billion.