Reverta: EUR 66.7m Paid to the State Treasury this Year


The performance of Joint-Stock Company Reverta in the first half of 2014 has been significant – a total of EUR 31m has been paid to the State Treasury. Overall, Reverta has already repaid EUR 66.7m during this year and a significant portion of the payment has been done ahead of schedule.

As a result of successful RE sales and loan restructuring, Reverta has recovered EUR 38.7m during the first half of 2014 and more than EUR 550m since 1 August 2010.

Solvita Deglava, Chairperson of the Management Board of Reverta, points out: “This is a significant achievement as our main objective is to fulfil our obligations towards our main creditor, i.e. the State Treasury. Nevertheless, we have to be realistic – there will be losses incurred. The accurate amount of losses will be known after completion of the asset disposal because Reverta’s performance is affected not only by the efficiency of our work but also at large by such factors as both Latvian and worldwide economic growth, the real estate market situation, the heavy schedule of Latvian courts and the counteractions undertaken by borrowers.”

264 properties have been sold for the total amount of EUR 16.3m during the first half of 2014 as compared to EUR 14m during the same period last year. The high indices can be explained by the rather dynamic real estate martket resulting both from the overall growth of the Latvian economy and the increasing number of new mortgage loans being issued. There was especially big demand for medium-sized flats in standard apartment buildings and the interest in land plots is moderate though increasing. The aforementioned economic circumstances along with the efficient sales strategy have allowed Reverta to increase the speed and volume of RE sales. By the end of June 2014, Reverta had offered 522 properties for sales.

Taking into consideration the uncertainty created by the Ukraine/Russia conflict, Reverta has made additional provisions for loan losses on loans affected by this conflict. The losses during the reporting period were in the amount of EUR 23.3m. As the value of some particular assets has decreased even by 90 percent due to the low quality of collateral securities, it can be expected that there will be need for even further provisions and more losses will be incurred.   

In line with the amendments to the Law on Control of Aid for Commercial Activity that were passed by the Parliament during the reporting period, Reverta will be allowed to repay sub-debts – the principal amount and interest, only after a full repayment of the State Aid. The adopted amendments will allow the State to be the first to recover investments into Parex banka and will allow Reverta to save EUR 4.4m of interest every year, as well as to postpone repayment of subordinated obligations in the amount of EUR 75m. The aforementioned sums mostly comprise payments to the former shareholders of Parex banka and associated persons.

 

Additional information:

Reverta is the largest distressed assets manager in Baltic countries. The main competencies of the Company are loan restructuring, debt recovery and real estate management. Reverta has recovered more than EUR 550m from development and sales of distressed assets between 1 August 2010 and 29 August 2014.

To learn more about Reverta, please visit the Company’s web page: www.reverta.lv.

 

 

For additional information contact:
Marita Ozolina

Head of Communications and Marketing Department
Phone: 67779142 or 29287169
E-mail: marita.ozolina@reverta.lv


Attachments

Publiskie 2014_1_pusg_ENG_EUR_Reverta_1.pdf