Earthquake – Eco – Super Bonus: a new opportunity for the NPL world

Earthquake - Eco - Super Bonus: a new opportunity for the NPL world 1

Here, I think it is superfluous to an introductory talk about the restructuring bonuses also because in this particular historical period it is probably the most talked-ever issue among insiders and outsiders.

The restructuring bonus in its earthquake / eco declinations has existed for some time, what today makes it so attractive and “sensational” are probably two of the new features introduced, the most significant:

1.   the so-called super bonus and the associated rate, which reaches 110% (effectively generating a credit higher than the value of the restructuring);
2. the possibility of more easily transferring the tax credit to third parties, with banks that are well equipped to seize this opportunity.

Obviously, we operators of the secured NPL / UTP market have listened to our ears. In GMA in particular, we spent a lot of time and resources during the spring lockdown to study the matter and analyse practical cases; today we can say that we are able to tackle the topic with greater awareness and we have the ability to identify potentially attractive and eligible situations in advance for the application of bonuses.
We have summarized in points what we consider our most important considerations:

bonuses also apply to Reoco and repossessed NPLs. Those (like us) who had some initial doubts, deepened the matter: there are no limitations whatsoever for Reoco and repossessed assets more generally, in recent months there has been a debate on the applicability of bonuses to legal persons and more than one ruling by Cassation and the Tax Commission have expressed themselves favourably on the matter;

 there are prerequisites for the applicability of bonuses. This is not the place to list them all, it is sufficient to say that there are some prerequisites that unequivocally determine the possibility of accessing the bonuses and the maximum quantification of the bonus payable; for operators this aspect is of particular importance, because it allows them to concentrate on the operations with the greatest probability of success. Obviously by addressing specific cases, the particularities of each position and the applicable rates are discovered;

–  starting a restructuring only for the benefits provided by the bonus is potentially a mistake. The practice is long and complex and the variables are many. Often, extra bonus costs, often not foreseen, are added to the costs subject to bonuses, which inevitably dilute the percentages and generate cash outflows not considered ab origine. Probably this consideration applies to this bonus and to all state subsidies in general. The question that needs to be addressed is: if there was no possibility of having the benefits, would we still do a requalification? If the answer is yes, the operation is a great opportunity and is faced with serenity;

the bonuses expire at the end of 2021. We are well aware that more than one rumour has recently been raised about an extension, in particular for the earthquake-bonus and the eco-bonus; as of today, what is certain is that the concessions will be in force until December 2021. It is therefore necessary to plan the works considering the technical times and putting in the budget the possibility that if these should continue beyond, they could not take advantage of the concessions.

Emanuele Grassi

GMA deals with NPL mortgage loans, property management and development to guarantee loans and securitization transactions. Contact us.