The performance of Popolare Bari NPLs 2017 S.r.l continues to support the ratings assigned at closing and as a result no rating action is warranted. (Current ratings on the transaction are available via the following links: Class A and Class B.) Profitability on closed positions is slightly above expectations at 103% of the business plan. However, gross collections are below expectations at 74% of the business plan. Scope has compared its own gross recovery projections to the observed performance of the transaction since closing and at this stage does not consider the underperformance of gross collections to have a material impact on the rated notes. Scope notices a majority of collateral proceeds so far have occurred following a DPO (“Discounted Payoff” extra judicial process), which is generally a more efficient process than court proceedings. Scope’s review is based on semi-annual investor reports and servicer reports through 31 October 2018, the original and updated business plans, as well as loan-level data through 30 September 2018.

Bari NPLs 2017 is a static cash securitisation of secured and unsecured non-performing loans (NPL) that were extended to companies and individuals in Italy. The loans were originated by Banca Popolare di Bari S.c.p.a. (95%) and Cassa di Risparmio di Orvieto S.p.A. (5%), which both belong to the Banca Popolare di Bari banking group. Credit enhancement on the class A and class B notes is 76.6% and 73.3%, respectively, as of the 31 October 2018 investor report. The transaction closed on 5 December 2017 and has a legal maturity of 31 October 2037.

The transaction relies on Prelios Credit Servicing S.p.A., the special servicer and master servicer; Securitisation Services S.p.A, which acts as inter alia calculation agent and representative of noteholders; Zenith Service S.p.A, the monitoring agent; BNP Paribas Securities Services (a subsidiary of BNP Paribas SA, rated AA-/S-1 Stable by Scope), which acts as account bank, agent bank, cash manager and principal paying agent; and JP Morgan AG, interest rate cap provider.

Scope continuously monitors Popolare Bari NPLs 2017 S.r.l.

Ratings and research are freely available at www.scoperatings.com.