The European Commission found on Friday 26 August that Italy’s plan to allow the transfer of certain state-guaranteed loans to a newly created platform managed by AMCO S.p.A. did not involve state aid.
The scheme, according to the institution, provides for a market-oriented remuneration for the Italian State. In addition, the sale of loans to the AMCO-managed platform and any new loans granted by the platform will be in line with market conditions.
Italy has notified its intention to allow banks to transfer some €12 billion from their balance sheets in the form of two types of loans: - loans benefitting from a State guarantee initially approved under the State aid Temporary Framework in April 2020; - unguaranteed loans of either the same debtors or connected ones. The economic and legal terms of the State guarantees, namely their duration, coverage and premiums, will remain as initially approved by the Commission.
Under EU State aid rules, if a Member State intervenes as a private investor would do and is remunerated for the risk assumed in a way a private investor would accept, then such an intervention does not constitute State aid.
According to the Commission, loan transfers, as well as AMCO services, will be carried out on market terms, i.e. in a manner that would be acceptable for a private operator. This is in particular ensured by the following elements: - the price of the loans transferred to the platform will be established through a mechanism driven by private investors via an open and competitive process; - the remuneration for the management of the loans will be benchmarked to the fees negotiated by asset management companies in comparable transactions on the market, (ensuring a sufficient level of profitability); - the new financing provided by AMCO to borrowers will be granted at the same rate as would be offered by private operators. (Original version in French by Lionel Changeur)