VP a panelist at SEE NPL Forum Vol. 5

The fifth SEE NPL Forum was held on November 19, 2021 at the Hyatt Regency Hotel in Belgrade, as well as on an online platform. The Forum was organized by New Angles Consulting – a company specialized in organizing business forums and consulting in the field of business development and marketing.

After a one-year break, the Forum gathered more than 100 representatives of banks, government agencies, financial advisors, investors, attorneys and debt collection companies from Southeast Europe (SEE), such as AKUPS, EOS Matrix, ODM Collection, NLB dd, EBRD, Kinstellar and others.

Through two standard discussion panels and two workshops, speakers from the group of national and regional experts focused on the current situation on the NPL market discussing potential strategies and trends.

The first panel opened with the inevitable topic – Covid-19 pandemic. In time when SEE countries have made significant progress in terms of NPL rates, a global pandemic followed. This, among other things, led to a decline in loan activities while many countries in the region introduced various financial measures such as moratoriums, that further affected all participants in the economic market. Some other topics were consolidation of the banking sector in the region, further development in accordance with the new EU Credit Servicing Directive, as well as the future look of NPL market in this area.

In addition to the already established national strategies that led to the decline of NPLs, service providers and investors continued to segment the market, achieving further efficiency. However, the pandemic and newly established measures have stalled the operations of participants in the NPL market. Consequently, the second panel addressed the questions of when and what kind of NPLs can be expected in the future; who will be the new buyers and at what prices; is now the time for negotiations on cooperation with banks; are there sufficient opportunities in the market of SEE region to service what is yet to come.

This year’s Forum novelties were two workshops. One of them discussed issues that arise during the negotiations on concluding contracts for the sale of NPL portfoliosduring which interested parties (bankers, financial advisors, attorneys, investors) shared their experience and main problems in concluding such agreements as well as NDAs.

Dejan Vuković, our firm’s managing partner, was a panelist in the next workshop. The second workshop, was dedicated to the issues of assessing the value of the NPL portfolio. The attitudes of banks and potential investors are generally contradictory – banks believe that their assessment of the value of the portfolio is relevant, while on the other hand, potential buyers are faced with the issue of “quality” of the portfolio, that is collectibility of receivables. The solution to this problem is to prepare a detailed legal report on the portfolio (DD – due diligence), but this requires additional costs for potential buyers. With this in mind, the Forum participants shared their experience in finding the most efficient and cost-effective solution for all parties.

We are thankful for the given trust and the opportunity to be a part of the fifth SEE NPL Forum. Our team will continue to take an active part in important topics such as the NPL market.