A portfolio of more than 14,000 properties seized from customers who failed to keep up payments will be sold off by Novo Banco as it clears out its non-strategic assets to improve its capital position.
Share in companies also will be sold as the bank strives to increase its capital before the European stress test in November highlights the bank’s capital shortfall.
The sell-off is as a direct result of the failure by the Bank of Portugal to find a buyer for Novo Banco.
In a rising property market the bank, led by Stock da Cunha (pictured), admits to a problem as its property portfolio is falling in value due to its past lack of willingness to maintain its property assets.
Real estate sales allow banks to free themselves of property assets which they have been hanging on to in the hope that prices will rise and, as in the case of Novo Banco, many have been on the books for five years or more.
The properties have been built up by Novo Banco's rigid foreclosure policy throughout the recession as customers who found themselves behind on payments had their homes seized and placed ‘for auction’, usually with no bidders.
In these cases the bank has then credited customers with the often low patrimonial value of the asset and ended up as the owner, but without the necessity of having to pay council tax.
Portugal's banks also have been reluctant to offload their portfolios en bloc due the depressing affect on price levels caused by large numbers of properties suddenly for sale.
Novo Banco now is in a hurry and its depreciating portfolio can be blamed on its own reluctance to maintain its estate in good saleable order.
Comments
This is another bank con , they are nto selling at a discount at all , merely offering unsecured mortgages to inflate the balance books.
The new tact is to offer them with 100 percent finance , the exact reason there was a subprime cause that led to the financial crisis itself.
Due to bail outs , imf , or in the uk taxpayer funding , the unlike the businesses and individuals they would hound to death for payments have not , and never will , sell these off disounted as long as they are allowed to inflate them as assets.
In any other situation , people and busninesses would have had to have their assets sold off to the highest bidder to pay their debts , not the banks.
On one property listed as 400k , I was ready to offer 300 , but ask for clarification on the price , the bank then added a zero.... and would not even talk about a discount.
In Ireland , eventually though you were able to buy a whole estate of 130 houses for 300k , they have turned the corner , but I fear Portugal will not and will backpedal.
Stop and ponder for a moment just what damage Salazarism has wrought and still does on this poor, bedevilled country.
OK - enough of this twaddle. Nothing will change for the better here in Portugal - it will only ever be copying what others are already doing elsewhere in the EU. Pretending to be doing what should be done. It has already peaked many years ago.
So now head off to :
https://www.novobancoimoveis.pt/
and start rooting around !