Financial Services, Latvia

By the end of 2016 Reverta had recovered EUR 740.3 mln which is 66% of all distressed assets received from Parex Bank, thus exceeding the initial estimates of Reverta’s management.

Currently there are only assets undergoing complicated and time consuming workout process left in Reverta’s loan portfolio. Other assets have been already disposed of and the recovered funds have been repaid to the state. In order to wind up economic activities of the company by the end of 2017, Reverta is looking for an investor to buy its remaining assets. Alongside the portfolio sales process, Reverta will continue workout of the portfolios until the closing of their sale.

In order to implement the European Commission’s approved Restructuring Plan which envisages completion of the workout of Reverta’s portfolio and closing of all operations by the end of 2017, Reverta has signed an agreement with KMPG Baltics for receiving expert’s advice on the sales process of Reverta’s loan portfolios.

Of 65 contacted potential investors 15 signed confidentiality agreements and in November 2016 received access to the virtual data room. Upon examination of the provided data, in December 2016 seven potential investors submitted their non-binding offers. In line with the recommendation of the consultant KMPG Baltics, four best tenderers were invited to participate in a more thorough examination of Reverta’s loan portfolio.

As reported, in 2010, Parex Bank was split into a good bank and a bad bank. The good bank was called the Citadele Bank and successfully continued the banking business, but the bad bank, left with the distressed assets of Parex Bank and later named Reverta, ceased to provide commercial banking services and instead focused on restructuring of loans, recovery of debts and management of repossessed real estate in order to recover the money invested by the Latvian government in the Parex Bank bail-out. According to the Restructuring Plan approved by the Cabinet of Ministers, Reverta's operations have to be discontinued by the end of 2017.