Online transactions of bad loans
The first online sales of nonperforming loans acquired by funds to new investors – i.e. new funds – are expected within the year. This is the development of a secondary market for bad loans, meaning the option investors have of transferring the loans they have bought from banks to other investors.
With this in mind, doValue with Debitos have set up a cooperation for the creation in Greece and Cyprus of doLook, a new online venture designed for NPL transactions. Via this platform, doValue will be able to resell bad loans, offering new investors access to the data on those debts. Interested parties will be able to bid for and buy those loans online.
Sources say that the first transactions through the doLook platform will happen by end-2021 and will at first concern small loan portfolios of 50, 100 or 200 million euros, as well as autonomous business loans – i.e. the loans of large enterprises that owe millions apiece.
According to the statement of Italian group doValue, active in Greece through securitizations, “the doLook platform that is especially designed for doValue will be adjusted to the special requirements of the markets in Greece and Cyprus so as to facilitate the sale of nonperforming loans managed by doValue and by other managers, utilizing the tested technological infrastructure Debitos has developed that is already available in the Greek language.”
Founded in Frankfurt, Debitos is considered a leader in the online secondary debt market, making it easier for companies, banks and funds to sell loans through an open, transparent online platform of transaction based on auctions.
The platform utilizes the digitalization of the entire sale transaction and can reduce the anticipated time of sales to just three to eight weeks, compared to three to six months via the traditional process. So far more than 1,200 investors from all over Europe have registered with Debitos. Therefore, doValue clients and those with access to the platform will benefit from the liquidity available in the market, as they will obtain access to over 1,200 institutional investors from 16 countries.
