New York (HedgeCo.Net) – Global hedge fund investor Cerberus has bought £2.3 billion ($3.6 billion) of risky UK commercial real estate loans, the New York Times reports.
The Royal Bank of Scotland Group (RBS) has sold a portfolio of Irish real estate loans – known as project Aran – to an entity controlled by Cerberus. Completion is expected in the first quarter of 2015.
National Australia Bank is to sell an additional £1.2 billion ($1.76 billion) parcel of higher risk loans from its UK Commercial Real Estate (CRE) portfolio to an affiliate of Cerberus Global Investors (Cerberus).
NAB Group Chief Executive Andrew Thorburn said NAB had accelerated the run-off of the NAB UK CRE portfolio, with the great majority of the remaining non-performing loans being sold.
“This is an important step forward, effectively bringing closure to one of our legacy positions. The sale of these higher risk loans in the portfolio is another important milestone in our strategy of reducing our low returning legacy assets and sharpening our focus on our core Australian and New Zealand franchises,” Thorburn said. “The remaining NAB UK CRE loans are largely strong performing loans, and we will look at other options to manage this small remaining portfolio.”
The transaction is part of the continued reduction of assets in its RBS Capital Resolution division and is in line with the bank’s plan to strengthen its capital position and reduce higher risk exposures.
The loans are known as ‘project Henrico’ are consist of mainly high loan-to-value loans.
Alex Akesson
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