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CaixaBank Will Save €550M Over the Next 3 Years from the Sale of its Real Estate

Posted by: In: Real Estate 01 Aug 2018 Comments: 0 Tags: , , , , , , , , , , ,
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27 July 2018 – La Vanguardia

CaixaBank estimates that the sale of 80% of its real estate business to the US fund Lone Star will result in a cost saving worth €550 million over the next three years, from 2019 to 2021.

On 28 June 2018, CaixaBank announced that it had reached an agreement with Lone Star to sell it a portfolio of foreclosed assets comprising real estate assets available for sale as at 31 October 2017 and the real estate company Servihabitat, worth around €7 billion in total.

The CEO of CaixaBank, Gonzalo Gortázar (pictured above), highlighted today that the operation, which is expected to be closed at the end of this year or the beginning of next year, will allow the entity to clean up its balance sheet of the foreclosed assets accumulated during the years of the crisis and to improve profitability.

“We have managed to reduce the volume of harmful assets sooner than we had expected, before the new strategic plan comes into effect” for the period 2019-2021 that CaixaBank plans to present in November, according to Gortázar.

The director added that the operation with Lone Star will not generate “a significant result” for CaixaBank, although it will allow it to increase its future profitability, thanks to cost savings of around €550 million over the next three years, given that having real estate assets on its balance sheet has an associated operating cost.

The completion of this sale will result in the deconsolidation of CaixaBank’s real estate business, which will make it “the bank with one of the most healthy balance sheets in the Spanish market”, he said.

Original story: La Vanguardia

Translation: Carmel Drake

The post CaixaBank Will Save €550M Over the Next 3 Years from the Sale of its Real Estate appeared first on Aura Real Estate Experts.

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