MILAN (Reuters) – Italian regional bank Popolare di Sondrio <BPSI.MI> said on Thursday it would sell 1 billion euros’ ($1.1 billion) worth of bad loans to lower their share of total lending to around 8% by 2022.
The bank said it had booked 106 million euros in loan writedowns between January and June, raising its provisions on defaulted loans to 68.4% of their value, meaning the latest sale was not expected to have any further negative impact.
Popolare di Sondrio held impaired loans equivalent to 13.65% of total lending at the end of June.
Italian banks have been working in the past three years to shed loans that turned sour during a deep recession. They have so far shifted some 170 billion euros in such debts off their balance sheets and disposals are continuing, albeit at a slower pace.
Popolare di Sondrio reported a first-half net profit of 47 million euros.
(Reporting by Valentina Za; Editing Kirsten Donovan)