The proposed co-investment project, which could see up to EUR450m invested, aims to help local economies recover from the crisis by addressing the problem of bad debts and troubled assets.
The co-investment strategy forms part of the Debt and Asset Recovery Program launched by IFC during the 2009 World Bank Group’s annual meetings in October. This program supports real and financial sector stability and growth by helping clean up bad assets, allowing businesses and banks to refocus on productive activities.
Lars Thunell, executive vice president and CEO of IFC, said: “Eastern Europe is one of the regions most severely affected by the financial crisis, leading to a dramatic increase in bad bank loans. By investing in these bad loans, we can help banks redeploy their assets back into the economy, giving a boost to economic recovery and job creation.”
Minneapolis-based Varde, with over $5bn in assets under management, invests in distressed securities and assets, as well as various types of discounted obligations, including nonperforming and underperforming corporate, consumer and real estate loans and high yield debt.
