Algebris unveils third Italian NPL-focused fund

Eugenia Jiménez
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Algebris unveils third Italian NPL-focused fund

Algebris Investments has launched a third fund dedicated to investing in Italy's non-performing loans market raising to three the number of NPL-focused strategies the UK-based hedge fund group has unveiled so far. 

The London-based company, led by Davide Serra, initially launched two Luxembourg-domiciled funds focused on non-performing loans (NPLs) in October 2014 and December 2016 respectively. 

Having reached its investment objectives with the initial launch, Algebris has launched the Algebris NPL Fund III, an investment vehicle that will pursue the same investment strategy than its two predecessors.

Luxembourg-domiciled, the new Fund will invest in NPL portfolios and single loans of Italian banks via an Italian Securitisation Vehicle, which will focus on loans guaranteed by real estate assets.

Targeting to reach €1bn in assets in the next 12 months, the Fund has already €125m committed and €500m potentially, which would arise from the interest expressed by some of the main institutional investors globally, said Algebris in a note.   

The new strategy will be managed by Algebris' NPL-specialised team, led by Gabriele Giorgi and Antonella Di Chio, and composed of six investment professionals with experience in the financial and real estate sectors.

The team is supported by Algos, the in-house Special Servicer formed by Algebris in 2019 to support its growing investments in the NPL space. With over 30-years of legal experience in the NPL space combined with strong Italian real estate industry knowledge, Algos provides for an alignment of interest with investors and full internal integration of investment and recovery teams, along with significant cost saving on servicing and due-diligence fees. All of the Algebris NPL portfolios including NPL I and NPL II are now serviced by Algos and will benefit from the cost savings of this model.

Davide Serra, Founder and CEO of Algebris, states: "Overall we think this asset class has a unique risk-return profile, given the limited downside risk, coupled with continued attractive returns. With the recent integration of the Algos operations we will soon have around 40 professionals wholly dedicated to our NPL business. This will boost our competitiveness in the market and increase returns for investors."

Eugenia Jiménez
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Eugenia Jiménez

Eugenia Jiménez speaks Spanish and is Iberia Correspondent for Investment Europe covering Spain & Portugal, as well as Italy.