In the first three months of 2017 (hereinafter also referred to as the Reporting Period), Joint Stock Company Reverta continued efforts to work out the distressed assets and to recover funds, at the same time, working actively to sell the remaining loan portfolios and to get ready for the planned liquidation of the company.
In February 2017, Reverta made a regular interest payment to the State Treasury in the amount of EUR 3.7 M. Overall, since the beginning of this year, the State Treasury has received from Reverta EUR 7.3 M because another payment of EUR 3.6 M was made already after the Reporting Period. Since 1 August 2016 till the end of Reporting Period, Reverta has repaid the State Treasury more than EUR 430 M but the total amount repaid to the State in the form of various payments is EUR 690.3 M, including EUR 16 M paid in tax.
During the Reporting Period, Reverta recovered EUR 13.5 M from the workout and sales of distressed assets, but the total amount of recovered funds since 1 August 2010 has reached EUR 753.7 M which is 67 per cent of all distressed assets left to Reverta after the takeover and split of Parex Bank. This result significantly exceeds initial estimates of the company’s management and also the average figures of the distressed assets sector.
Good results have been achieved also in the sales of real estate properties – during the Reporting Period 17 real estate objects, including land plots, were sold for the total amount of EUR 4.3 M. By the end of the Reporting Period, the real estate portfolio had decreased to approximately 50 objects and it is planned that the remaining real estate properties will be sold by the completion of the liquidation of the company. During its operation, Reverta has sold a total of 1800 real estate properties. This result confirms the correctness of Reverta’s chosen sales strategy: to establish a small and efficient sales unit with ambitious but clearly defined goals and tasks in place, to review the prices of the real estate objects on a regular basis and in line with market realities, and also to identify and address appropriate target audience.
During the Reporting Period, Reverta’s losses were in the amount of EUR 5.7 M and consisted mainly of interest expense on the State aid. In view of the low quality of the assets left to Reverta, losses were incorporated already in the Restructuring Plan and cannot be regarded as the measure of the performance of Reverta.
Reverta’s total assets at the end of the Reporting Period were EUR 51.6 M, as compared to EUR 1.1 B at the start of operation. Reverta has already worked out and disposed of all other assets, and the recovered funds have been repaid to the State. To suit the reducing assets and the liquidation process that will be commenced soon, Reverta’s operation has been adjusted and the staff numbers have been decreased.
In order to implement the EC approved Restructuring Plan which envisages completion of the workout of Reverta’s portfolio and closing of all operations by the end of 2017, Reverta together with the financial consultant KMPG Baltics continued the efforts to sell the remaining loan portfolios. During the Reporting Period, the assessment of four binding offers was commenced.
Events after the end of the Reporting Period: - On 5th, 12th, and 13th May 2017, Reverta made regular interest payments to the State Treasury in the total amount of EUR 3.6 M; - On 29 May 2017, annual general meeting of Reverta’s shareholders took place, during which the shareholders approved Reverta’s Annual Report for the year ended 31 December 2016, selected external auditors for the year 2017, elected Audit Committee, approved amendments to Reverta’s Articles of Association, and made a decision to commence the liquidation of Reverta on 1 July 2017; - The assessment of the binding offers of investors is still going on, and soon the best offer will be submitted to the Cabinet of Ministers of the Republic of Latvia for the reviewing. To learn more about Reverta, please visit our web page: www.reverta.lv. For more information contact: Marita Ozoliņa Head of Communication and Marketing Department Tel.: 67779142 or 29287169 E-mail: marita.ozolina@reverta.lv
