Nordic Market Overview, H2 2021
In 2020, we had significantly lower prices for Forward Flows than before and a maximum of 6-12 months agreement compared to the previous standard which was 12-24 and up to 36 months. Large number of transactions available in the Nordic market for both OO and FF and especially within Bank & Finance. Requests for longer contracts are again up on the table with up to 24 months while the buying side tries to reduce this more to 12 + 12 months arrangement and instead of having the opportunity to adjust the price after 12 months.
The price level of unsecured loans in the segment 300 00 – 500 000 SEK has remained low while we see that there is a lot of competition now for the lower amounts, which once again leads to higher prices in that segment. At the moment, there are too many unsecured loan providers on the market and those with slightly more generous credit terms will have trouble selling off their NPL portfolios to the price levels that they calculated with.
Large increase in Sweden in the number of applications for debt restructuring but at the same time also an increased amount of rejections as many applicants have not made sufficient attempts to sort out their finances first. KFM has informed about this now after the summer. In Finland, tax refunds have been at record levels, which also had a positive impact on return of investments during August and September. Norway has had a steady collection and flow of cases for most of the Corona and although there are some concerns in that market that there will be backlogs around consumers’ debt picture, the prospects are good there. In Denmark, there have been a lot of large portfolio deals within Bank & Finance during the summer and the start of the autumn. A tightening within the credit terms for e-commerce has resulted in several Nordic e-retailers choosing to leave Denmark now and leaving OO-portfolios available on attractive levels.
Increased competition in the Nordic region regarding the purchase of NPL portfolios as several of NPL buyers have been reloaded with funds to invest either through new bonds or through collaborations with major institutional investors. Most players also believe that there will be consolidation in the debt collection and NPL market within the next few years. Exciting times ahead!
Please feel free to contact us for more dialogues and opportunities around the Nordic NPL market.
/COO, Johan Gustafsson
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