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BAMC reaches €1 billion euros in asset recovery value mark ahead of schedule

Ljubljana, 16. June 2017 – BAMC reached an important milestone recently. Significantly ahead of schedule, it successfully recovered over half of the value of the portfolio of assets transferred to it from Slovenian banks of systemic importance. In just three and a half years from the first transfers, BAMC generated over a billion euros cash inflows, more specifically a 1.086 million euros cumulatively until the end of May 2017.

With the €1 billion inflow generation threshold required for 2019, already achieved in May 2017, BAMC is by far surpassing the minimal requirement set in the Guidelines on BAMC operations.  In first five months BAMC also surpassed the annual statutory target of €200 million for the entire year 2017, since it has already generated €227 million of inflows by the end of May. The largest portion of 2016 inflows comes from the sail and repayment of claims (80%), and the remaining share comes from real estate and equity sales.

This year’s largest transactions comprise the sales or repayments derived from claims towards companies DZS, Sava turizem, Vizija holding, Vizija holding 1, Grep, Sava TMC, Imparo and others. BAMC has also invested a great deal of energy into accelerating real estate sales, which has lately been shown not just in the residential real estate sales, but also in the sales of other types of properties owned by BAMC.

As a result, BAMC successfully reduced its cumulative debt of almost €2 billion to almost one-half, and through the repayment of 1,7 billion euros high cost debt and raising 750 million new, low cost financing reduced its borrowing costs, which were huge burden on profitability in previous years, by 40 million in two years, and, as a result, posted 4,5 million euros profit in first quarter of 2017.

As of 31 May 2017, BAMC’s portfolio included over 2,000 claims, real estate assets and equity shares, with a total estimated value of more than €1,05 billion.

While in 2014 - 2015, BAMC generated its cash flows mainly from large transactions, last year it generated a substantial share of its revenues also from small-ticket sales, which require an even more labor-intensive activity. Despite this, there are still plenty of interesting investment opportunities in its portfolio, realization of which, on the other hand need further intensified sales efforts, supported by focused marketing activities.

In macroeconomic sense, BAMC’s active recovery activities have contributed to ensuring more efficient use of previously bad assets, by putting them in the hands of new owners and/or better utilization in successfully restructured companies, which has also contributed to the revitalization of Slovenia’s economy.