ARC sells P13.2-B Metrobank NPAs to German bank

Asia Recovery Corp. (ARC) has disposed of P13.2-billion worth of non-performing assets (NPAs) acquired from Metropolitan Bank and Trust Co. (Metrobank) two years ago to a subsidiary of a German bank.

The sale, conducted through an auction, represents almost all of ARC’s current inventory of non-performing loans and acquired assets.

ARC president Pedro Jaminola Jr. said the winning bidder in the auction held on Wednesday is a subsidiary of Hypo-und Vereins Bank AG (HVB). The bidding attracted several large foreign financial and investment institutions.

"This is a very well-priced transaction. We are very pleased with the outcome and goes extremely well with our mandate as a special asset management company," Jaminola said in a statement.

HVB, a member of the UniCredito Group of Italy, is the second largest bank in Germany and one of the 10 largest in Central and Eastern Europe. It specializes in retail and mid-cap customer businesses and has 2,000 branches within and outside of Germany, employing over 60,000 employees.

Metrobank president Antonio S. Abacan Jr. meanwhile, said the universal bank plans to unload between P8- to10-billion worth of (NPAs) this year.

"We want to get rid of the NPAs in the first quarter or at latest the first semester," Abacan said. Of the total NPAs, roughly P5 billion are non-performing loans and between P3 to P5 billion are ROPOAs (real and other properties owned and acquired).

The country’s leading commercial bank recorded a net income of P3.6 billion last year.

"This was inspite of a 220-percent jump in provisions for probable losses, which hit P2.1 billion from only P660 million a year ago," bank officials said.

Total resources climbed 4.8 percent to P481.4 billion.