Banca IFIS

Banca IFIS is the fourth largest NPL operator on the Italian market in terms of volumes managed (24.4 billion Euro of NPLs) and is the leader in the unsecured non-performing loan segment. Banca IFIS was among the first companies to enter the non-performing loans market, and since 2011 it has purchased over 22 billion Euro of non-performing loans by nominal amount, recovering over 1 billion Euro in cash from its proprietary NPLs. Banca IFIS operates on the non-performing loans market as a primary investor and owns one of the top servicers currently operating in Italy. The Bank's main competitive advantage is its ability to purchase and manage NPL portfolios, paired with a proprietary database of over 1.2 million Euro of debtors, organised into uniform groups by type, age, residence, amount due, profession, recovery times and guarantees. Even more than the secured segment, the unsecured non-performing loans segment presents barriers to entry due to the considerable investments required in terms of personnel and IT, the achievement of economies of scale, an efficient organisation to manage internal and external recovery personnel and an extensive, detailed database. However, the unsecured market is a relatively mature segment, with prices and margins expected to remain essentially stable in the coming quarters. In terms of transactions, we expect the non-performing loan market to remain dynamic over the next three years, with an increase in transactions on the secondary market. In fact, in the three years from 2020 to 2022, the market is expected to see 84 billion Euro of new sales of non-performing loans, of which approximately 20 billion Euro of unsecured NPLs. Of the total transactions, 70% is expected to occur on the primary market and 30% on the secondary market, driven by sales organised by securitisation vehicles, including those that have benefited from government guarantees (GACS) and are seeking to improve cash generation.