Secondary NPLs are becoming increasingly important for the Italian NPL market, and Link Finanziaria is a leading player in this area.  Link was invited to participate in a panel on the subject hosted by Sole24Ore in Milan, to share knowledge, experience and best practice.

Legal Manager, Paolo Musaragno was Link Finanziaria’s representative at the session entitled “The Secondary NPL Market: New management models and specialized services”.  He contributed thoughts on what constitutes best practice during the analysis and segmentation phases of these acquisitions; both leading up to the purchase as well as once the portfolio is under management.  Paolo commented that it is very important to first understand the reason for sale, pointing out that buyers need to understand if the desire to sell is the result of a market exit strategy, or whether the seller has purely speculative intentions.

Pricing is clearly fundamental since documentation and guarantees are limited and there are difficulties in both technical and document analysis. This is an area where artificial intelligence can be very useful with the support of a management system tailored to these specific needs.

The panel discussed the possibility of GACS being applied in the secondary market, which was considered unlikely, except for instances where there were minor portfolios or individuals.