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October 5, 2022

Reff & Associates and Deloitte Romania assisted Bank of Cyprus in the sale of the residual portfolio of non-performing loans and repossessed properties owned in Romania

  • This is the largest deal of non-performing assets on the Romanian market in 2022, involving a portfolio with a face value of around 147 million euros

Reff & Associates | Deloitte Legal and Deloitte Romania advised Bank of Cyprus in the sale of a portfolio of secured non-performing loans and repossessed real estate assets located in Romania, with a total contractual value of around 147 million euros, to an entity part of the APS group. The transaction was signed in May 2022 and closed on August 24, 2022, after being scrutinised by the Romanian Competition Council.

The sale of the residual Romanian portfolio of non-performing assets held by the Cypriot group was made in the context of Bank of Cyprus’ decision to wind down its operations in our country, which was gradually implemented over the last years.

“This was the last key milestone transaction in our overseas deleverage plan, as we continue shifting our focus on serving our local market. We were fortunate that during the years of our presence in the Romanian market we had the support of Reff & Associates | Deloitte Legal team, who are a trusted and reliable advisor, always paying attention to the commercial angles of the transactions, beyond the necessary legal technicalities”, said Ioannis Petrou, Manager Corporate Finance Solutions, Bank of Cyprus.

Throughout the entire lifetime of the project, the lawyers from Reff & Associates | Deloitte Legal advised the bank on all legal implications pertaining to the disposal process, from the preliminary deal structuring, drafting the package of transaction documents, during the negotiations with APS and its advisors, up to signing and closing, and will also advise on the fulfilment of post-closing formalities.

The significant legal complexity of this deal derived from the heterogeneous nature of the package of distressed assets transferred, as well as from the application of several law systems (Romanian, Cypriot and English) and regulating specific formalities to be fulfilled in each relevant jurisdiction. The team of lawyers from Reff & Associates | Deloitte Legal advising the bank included Andrei Burz-Pînzaru, Partner, Andreea Șerban, Senior Managing Associate in the Banking and Finance department, who led the entire project team, Iulian Maier, Senior Associate (Corporate M&A), Diana Stan, Managing Associate, and Alexandru Butușină, Senior Associate (Real Estate), Florentina Munteanu, Partner, and Mihnea Radu, Senior Associate (Competition), and Dănuț Arion, Associate (Banking & Finance).

The Deloitte Romania’s tax practice covered the transaction’s fiscal aspects and was involved in the project through Alexandra Smedoiu, Partner, Raluca Baldea, Partner, Anca Ghizdavu, Senior Manager, and Alexandru Stancu, Senior Manager.

“The closing of this deal, which, based on publicly available information, seems to be the largest transaction of this kind on the Romanian NPL market in 2022, is a great success for our team, due to its high legal complexity and the very tight implementation calendar. We are very grateful to the bank for the trust they have shown us over the years of our collaboration and I want to congratulate my colleagues for their professionalism and the dedication they showed in this challenging project”, said Andrei Burz-Pinzaru, Partner, Reff & Associates | Deloitte Legal.

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