Elliott, CRC Are Said to Bid for Banco BPM's $6 Billion Loans

(Bloomberg) -- Christofferson Robb & Co., Davidson Kempner Capital Management, and Elliott Management Corp., are among bidders for the riskiest part of a securitization backed by 5.1 billion euros ($6 billion) of Banco BPM SpA’s bad loans, according to people with knowledge of the matter.

Italy’s third-largest lender asked for final offers to be submitted by June 18 for the equity and mezzanine tranches of a securitization known as “Project Exodus,” said the people, who asked not to be identified because the matter is private. Pacific Investment Management Co. is also among firms that made non-binding offers for the loans, one of the people said.

Banco BPM is among the Italian lenders that are accelerating their cleanups to take advantage of an economic rebound and a more stable financial industry. The lender plans to dispose of 13 billion euros of bad loans through 2020 to cut its non-performing-loan ratio to 11.5 percent of total loans. Chief Executive Officer Giuseppe Castagna said that additional 3.5 billion euros of soured debt will be sold later this year.

Representatives for Banco BPM, CRC, Davidson Kempner, Elliott, and Pimco declined to comment on the offers.

Banco BPM transfered the loans to a securitization vehicle called Red Sea on May 31. It’s planning to sell the junior tranches and retain the senior portion for which it will request a government guarantee, known as GACS, the lender said in a statement last week.

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