Greek lender Piraeus Bank has established a new platform in partnership with Sweden’s Intrum to manage bad loan portfolio.

The ownership of the new Recovery Banking Unit platform will be transferred to a new servicer company, which will be licensed and regulated by the Bank of Greece.

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Under the terms of the partnership, Intrum will hold 80% of the new servicer company, while the remaining 20% stake will be with Piraeus Bank. The new platform is estimated to value €410m.

The Piraeus Bank Recovery Banking Unit platform will sign a contract to manage the Greek lender’s €27bn ($30bn) non-performing exposures (NPE) portfolio.

The initial term of the contract will be for ten years, under which it will manage Piraeus’ NPE portfolio exclusively.

The platform will also be responsible for any new inflows and may also manage NPE portfolio of other third parties.

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Piraeus Bank CEO Christos Megalou said: “This transaction is a milestone for Piraeus Bank in terms of its de-risking strategy. We have found in Intrum the right long-term industrial partner to proceed with this joint venture.

“The joint venture will enable us to boost the efficiency and effectiveness of managing our non-performing exposures.

“The new Piraeus Bank that will emerge post the transaction will be an agile and results-oriented organisation. We will focus on core banking activities and will continue catering to the needs of our customers, shareholders and stakeholders.”

Subject to regulatory approvals and the Hellenic Financial Stability Fund-nod, the transaction is scheduled to close on 1 October 2019.

Piraeus Bank and Intrum will also form a second servicer to manage the Greek bank’s Real Estate Owned Assets (REOs). This servicer will also have the same shareholding structure.