Credito Fondiario is a leader in the Italian credit sector, in which it operates with a distinctive business model as both debt purchaser (purchase of NPL and UTP) and debt servicer (management and recovery of impaired loans), with a banking license.
The business model adopted by Credito Fondiario has been innovative in the Italian market, adapting the one used by the major international players operating in the Credit Management sector.
The top management and Tages, a leading independent asset manager in alternative assets with $2.3 billion under management in which a group of Italian entrepreneurs met, acquire control of Credito Fondiario from Morgan Stanley at the end of 2013 – at a time when the institution, which had a history of over 100 years, was accumulating over €20 million of losses per year.
The team, whose strategy was clear, achieved a successful turnaround: it aimed to create an Italian bank that operates in the secondary credit market, with a very wide range of products and services, able to compete with the biggest players of the sector, such as large international funds and services.
Currently, the top management is the minority shareholder alongside the new majority shareholder – Elliott, which holds 82% of the capital.
Within 5 years, Credito Fondiario has become a benchmark operator in the market, growing in dimension, obtaining a strong competitive positioning, working as partner beside banks and institutional partners.
The assets under management accounted for EUR 4 billion in 2014, and today they are more than EUR 55 billion, and EUR 15 billion are assets managed as special servicer.
With the signature of the final contract with the Elliott fund for the acquisition, for an amount of EUR 7.4 billion of non-performing loans by Banco Bpm, and the creation of the CF Liberty Servicing management platform in a joint venture with Banco (of which Credito Fondiario owns 70% of the shares, and Banco Bpm 30%) – probably the last large transaction in the market – Credito Fondiario is to massively increase its workforce, which will grow from 50 to around 350 at the end of 2019; the investments made the company grow up to EUR 700 million (for a nominal value of credits purchased of almost EUR 4 billion). At the same time, the bank maintains one of the highest level of capitalization and financial solidity in the sector. Credito Fondiario closed 2018 with a net profit of EUR 24.8 million, as compared to a loss of EUR 1.1 million year-over-year.
Credito Fondiario is benchmark operator for large operations in the Italian market, in a domestic market characterized by banks which have the need to reduce the non-performing loans on their balance sheet (the so-called derisking).
Credito Fondiario took part in the entire process, covering different positions thanks to the flexibility of its business model. The institution is:
In particular, at the end of 2017 Credito Fondiario, following a competitive process, reached an agreement with Carige which led to the acquisition of:
The acquisition of the business unit of the company was completed on May 14th, 2018, and it was preceded by a trade union agreement between Banca Carige and Credito Fondiario, which has allowed them to align the contractual terms of the employees and the branch of the businesses, with the Credito Fondiario best conditions.
Today, more than 50 resources work in the new central headquarter of Credito Fondiario in Genoa, in a building located in via 20 Settembre, in which employees from Milan and Rome will be relocated.
Genoa will be the core of a growth plan, and this will lead to more business occasions and therefore new jobs, leading to a great advantage for the whole city.
CF Liberty Servicing, the new platform of recovery and management of non-performing loans in joint venture between Credito Fondiario and Banco BPM, was created at the end of June 2019.
The society – 70% owned by Credito Fondiario and 30% by Banco BPM – will manage the EUR 7.4 billion portfolio of the Bank as servicer. The bank was acquired by Elliott in the context of a securitization concluded on February 2019, with GACS on senior debts, the remaining stock of NPLs of Banco BPM and, in the next 10 years, a relevant portion (equal to the 80%) of the new streams of NPLs.
With this operation, Credito Fondiario has asserted its position as the leading society in Italy in the credit management sector, and significantly increased the number of its employees who, thanks to the joint venture, will have their number increased to nearly 350, now located in Bergamo, Verona, Lodi and Naples.
During the last 24 months, Credito Fondiario has conducted due diligence activities on over EUR 45 billion of NPL and/or UTP loans, analyzing a large portion of the Italian credit market in all its ramifications (real estate, retail, leasing, corporate etc.)
A successful formula – the reasons for the success of Credito Fondiario must be found in the will of the top management and its shareholders (Elliott owns around 82% of the capital, while the remaining 18% is held by Tages and the top management) to focus on a mix of skills, innovation and a great deal of knowledge of the Italian market:
Since 2016, the Top Management and Tages have been joined by Elliott, one of the largest investment company in the world, which became the majority shareholder of the Bank in October 2018.
Elliott, with a long-term vision, supported Credito Fondiario’s growth in the last years with the injection of new capital and strengthening the managerial structure – aiming to make it become a true, well-known market leader.
