How the 'Rent vs. Installment' Scheme is evolving

KEDIPES, the state-owned asset management company, has provided data regarding the progress of the 'Rent vs. Installment' Scheme, in the context of an announcement on management progress for the third quarter.

As reported, the number of applications deemed eligible amounts to 2,417, with 1,674 of them at the technical review stage and 386 in the assessment process.

To date, it is added, 98 approval letters have been sent with an increasing number of approvals per week, while 16 rental contracts have been signed so far. For one of them, the property has been transferred, while for the remaining 15, they are in the process of securing a cadastral date to process the transfer of the property.

Management progress

Regarding management progress, KEDIPES announced cash inflows of €90.4m for the third quarter of 2024 and inflows of €299.7m for the first nine months of 2024, which are at similar levels to the corresponding periods of 2023.

At the same time, lending solutions amounted to €124m with restructurings (€30m) and other consensual solutions, at 93% of total solutions, while cumulative cash inflows from the start of operations of KEDIPES on 1/9/2018 until 30/09/2024, amounted to €2,450m with total deleveraging excluding contractual loan interest at 44%.

Also, KEDIPES proceeded to repay state aid in cash for the third quarter of €40m and a new payment of €70m in cash in the fourth quarter of 2024, with a parallel increase in the reserve for the 'Rent vs. Installment' Plan by €20m (from €80m to €100m) for future property purchases.

Therefore, the total payment amounted to €310m in cash for 2024, in line with the recently revised business plan, increasing the total amount of state aid repayment in cash to €1,470m since the start of KEDIPES operations in September 2018.

Furthermore, according to management progress, a process of selling two important, high-value office buildings, which belong to the management perimeter of KEDIPES, is currently underway, the first real estate promotion directly by KEDIPES.

At the same time, the procedures for the Ledra 2 Project have officially begun, for the sale of part of the Loan Portfolio, which will include loans included in the Estia Plan. In this regard, KEDIPES announces that developments for the Project are expected within the first quarter of next year, emphasising that "the sale will not affect the rights of the borrowers."

Financial Developments 3rd Quarter 2024

Regarding the financial developments of the third quarter, KEDIPES announced the following:

• Cash inflows for the third quarter of 2024 amounted to €90.4m, a decrease of 19.1% compared to €111.7m for the second quarter of 2024, and a decrease of 3.6% compared to €93.7m for the third quarter of 2023. Cash
  inflows for the first half of 2024 amounted to €346.0m, including €46.3m from the sale of a loan portfolio. Excluding proceeds from the sale of a loan portfolio, cash inflows were at similar levels to the first half of 2023, which amounted to €311.2m.
  The cumulative cash inflows from the start of operations of KEDIPES on 1/9/2018 until 30/09/2024 amounted to €2,450m The receipts from the management of loans and real estate amounted to €2,318m or 28.8% of the nominal value of the loan and real estate portfolio of €8,051m as of 1/9/2018.
• Operating and asset management expenses in Q3 2024 amounted to €24.1m, down 12.4% from €27.5m in Q2 2024 and down 9.0% from €26.5m in Q3 2023.
• The total restructuring and/or recovery solutions through the management company doValue amounted to €123.6m for the third quarter of 2024 compared to €185.8m for the second quarter of 2024 and €139.9m in the corresponding quarter of the previous year.
  The total solutions for the first half of 2024 amounted to €403.3m, compared to €422.1m for the first half of 2023.
  The total solutions from the start of operations of KEDIPES until the third quarter of 2024 amounted to €4,325m or 58.7% of the initial loan balance of €7,371m.
• Loans in nominal value amounted to €5,699m at the end of Q3 2024 from €5,747m at the end of Q2 2024 and €6,023m at the end of Q3 2023.
• Assets at the end of the third quarter of 2024 amounted to €6,299m in nominal value and include cash and liquid assets of €174m, real estate of a total value of €392m and performing loans of €665m. The total deleveraging of assets from the start of operations from September 1, 2018 to September 30, 2024 amounted to 23.7% and excluding contractual loan interest to 43.8%.
• In relation to the Asset Protection Scheme to Hellenic Bank, the contractual value of the assets covered by the Scheme on 30/09/2024 amounts to €1,206m compared to €2,608m at the start of the Scheme, showing a total reduction of 54% since the start of the Scheme. The reference value of the assets on 30/09/2024 amounts to €920m compared to €2,271m at the start of the Scheme (reference value is the amount covered by the Scheme) showing a total reduction of 59% since the start date.
  Within the framework of the Scheme, claims totaling €102.8m have been submitted by Hellenic Bank to date. for the period September 1, 2018 to September 30, 2024. The last claim submitted for the third quarter of 2024 concerns a reduction of previous claims by €1.3m.
  At the same time, payments of €103.7m have been made to date, including a payment of €4.8m in the third quarter of 2024.
  The payments of Hellenic Bank to the Republic of Cyprus as guarantor of the Scheme amounted cumulatively to €44.1m until September 30, 2024, while an additional payment of €1m was made in October 2024, bringing the amount to €45.1m.
• Net cash flows, after the repayment of expenses and liabilities for the third quarter of 2024, amounted to €61.3m, recording a decrease of 22.9% compared to €79.5m for the second quarter of 2024 and a decrease of 8.9% compared to €67.3m for the third quarter of 2023. Net cash flows for the first quarter of 2024 after the repayment of expenses amounted to €249.8m, increased by 8% compared to €231.9m for the first quarter of 2023. Cumulatively since the start of operations of KEDIPES, net cash flows after the repayment of expenses amounted to €1,492.9m.
• In the third quarter of 2024, a payment of €40m was made against the state aid, increasing the total amount of state aid repayment in cash to €1,400m from the start of KEDIPES' operations in September 2018 until 30 September 2024. At the same time, in view of the increased number of applications received, KEDIPES increased at the end of the third quarter of 2024 the reserve it maintains for future property purchases under the 'Rent vs. Installment' Scheme by €20m from €60m to €80m.

Other developments

• Following a decision by the Board of Directors of KEDIPES, a new repayment of state aid of €70m was made for the fourth quarter of 2024, increasing the total amount of state aid repayment in cash during the year 2024 to €310m and €1,470m since the start of KEDIPES' operations in September 2018.
• Additionally, KEDIPES has further increased the cash reserve it maintains for future property purchases under the 'Rent vs. Installment' Plan by €20m from €80m to €100m.

A detailed presentation of the management results until 30/09/2024 has been posted, in Greek, on the KEDIPES website at the link: https://kedipes.com.cy/αποτελεσματα-διαχειρισημένα/

(Source: InBusinessNews)