KRUK in Q3 2019: Investments in four countries and PLN 433m in recoveries from purchased debt portfolios.
In Q3 2019, KRUK invested PLN 83m in debt portfolios with a total nominal value of almost PLN 734m. Over the same period, recoveries from debt portfolios held by the KRUK Group came to PLN 433m.
In the third quarter, the KRUK Group invested in 33 portfolios in four markets: Poland, Romania, the Czech Republic and Slovakia. Year to date, the investments totalled PLN 392m, down 63% year on year.
“Our investments, both in the third quarter and on the year-to-date basis, are lower than we had originally planned. They are lower than in the corresponding period of the previous year, but the returns on these transactions are much higher compared with the portfolio acquisitions we made in 2018 and 2017. We mainly invested on the Polish and Romanian markets (85% in aggregate from January to September 2019), intentionally limiting, for the time being, our investment activity in Italy and Spain. However, we are poised to soon resume our investments on these two markets,” said Piotr Krupa, President of KRUK S.A. “We can see a growing supply of portfolios in the fourth quarter, which is usually the most busy period transaction-wise. We also see more and more factors which in the long run should increase banks’ interest in selling their debt. One of them may be the recent CJEU’s judgment of October 3rd 2019 concerning CHF loans. Although it will have no direct effect on KRUK’s performance and position, it will translate into higher debt sales by banks.”
Recoveries from the debt portfolios held by the KRUK Group amounted to PLN 433m in Q3 2019, with recoveries for the first nine months of the year at close to PLN 1307m. This represents an increase of 14% relative to the same period of 2018.
“Recoveries in the third quarter declined by 3% relative to the quarter before, reflecting among the others seasonality. At the same time, the contribution of Italy has been on the rise: having now come close to 10%, compared with 7% in the corresponding period of 2018. Year on year, third-quarter recoveries in Italy grew by 56% and in Spain by 49%.”