Good morning, and welcome to the doValue's first half 2023 results conference call. I'm Daniele De Falco, Head of M&A and Strategic Finance in doValue, and acting of IR. I'm joined here in Rome today with Manuela Fanti, our Group CEO, and Davide Sopcich, Group Deputy CFO, and Theodore Karantonis, Chairman of doValue Greece. Together, we will cover the main group and market developments since the beginning of the year, as well as the financial performance for the first half. At the end of the presentation, we will be happy to take any questions that you may have. Let me start now, hand over to Manuela to get started.
Thank you, Daniele. It's a great pleasure for me to present our first half of 2023 results. Moving to the presentation, on page 3, we show some of the key developments in the group performance in the first half of the year. First, I would like to highlight a return of doValue to a stronger trajectory in the second quarter after a challenging start of the year. Our performance has been satisfactory, both in terms of revenue growth and profitability, driven by very positive performance in Greece and our ongoing restructuring in Spain, following the off-boarding of the SAREB portfolio. Our Q2 gross revenue increased by 8% year-on-year, excluding SAREB, to EUR 128 million. Second, our revenue growth has been coupled with a very healthy EBITDA ex-NRI margin of 58.9%, versus 51.7% in same year.
EBITDA in the quarter has been growing by 57.9% year-on-year, excluding SAREB, to EUR 50 million. Please note also that the year-on-year on the 2Q is double digit positive, even including SAREB in the second, in 2022. This is a very satisfactory result, made possible by strong focus on cost discipline, a seamless execution of a complex restructuring plan in Spain, and a very healthy top line growth in Greece, driven by positive macro environment in the region. Our quarterly EBITDA margin is also reaping the fruits of our strong capital made in the past on our IT and transformation plan, which has made our operation more efficient. Third, our EBITDA has stabilized thanks to higher volumes from our solar flow contracts and commercial efforts across all the regions to capture either new mandate and harvest a more broad and diversified customer base.
Last but not least, even after the payment of a very generous dividend of EUR 48 million, Despite the similar seasonal effect of our business, higher taxes, our net leverage still stands at 2.3 times as of July, one of the lowest in the credit servicing industry, and well below our maximum threshold of 3 times. This allow us to find the right balance between shareholder remuneration and growth through M&A. As you all know, Greece has been a very successful acquisition for doValue, and has been one of the major driver of growth and profitability in our last 3 years. For this conference call, I believe it's time to give credit to our people of doValue Greece, thereby representing here Mr. Karantonis, Chairman of doValue Greece, who will provide you with a comment on the entity and the growth path.
Thank you, Manuela, for your kind words. In general, the Greek economy has proved more resilient than its European peers to the energy price point, 5%, and considerably higher than the Eurozone average of 3.5%. This year, the economy continued to overperform in Q1 at a yearly rate of 2.1%, and is expected to remain around 2% both in 2023 and 2024, despite a stark inflationary external environment. Unemployment, currently at about 10%, remains in steady decline. Core inflation has fallen to 4.8%, while headline inflation dropped last month to 1.8% year-on-year. Public finances are also on a positive trajectory. A primary surplus of 1.1% of GDP is expected for 2023, on average, at 2.3% of GDP for the 2024-2026 period.
Along with strong nominal growth, it comes also a rapid de-escalation of the debt to GDP ratio at slightly over 160% in 2023, down from 195% as recently as in 2021. On the other hand, the current account deficit, although improving, remains quite high at circa 7%. Finally, the political uncertainty came to an end with the landslide victory of center-right, pro-business, New Democracy Party. Following this result, it is widely expected that Greece will regain investment grade, most likely within the year. This newly gained policy visibility, along with the availability of EU structural funds, makes the goal of sustained overperformance relative to the Eurozone peers realistic.
On the back of the above, and in an improving economic environment and a very constructive real estate market, Greece is performing better than other markets on NPL collections. The level of state support of businesses and households during and after the pandemic exceeded all expectations. More than EUR 65 billion were disbursed in loans and outright state subsidies since 2020. Resilient income and increased personal and business deposits helped sustain the rate of collections despite the extreme economic disruption, and this is expected to continue. The primary loan sale market is expected to remain strong until the end of 2024, despite the recent mega cleanup of the four systemic Greek banks NPE book. The current level of NPE ratio of four major banks varies between 5% and 10%, and is expected to further decrease to well below 5% in the next two years.
A new hub scheme is also expected to be launched in the next few months by the Greek state to facilitate these efforts. In total, around EUR 5 billion of new hubs back transactions are expected to happen by the end of 2024, while the EUR 5 billion Ariadne portfolio from the Greek liquidator, Axway, is also expected to be relaunched in France by the end of this year. Meanwhile, the secondary loan market has developed significantly, with doValue Greece playing a major role. Total transactions in 2022 were circa EUR 5 billion, with a similar amount forecast for 2023. Reperforming loan transactions have yet to gain stream, steam, but Greek banks need to support their credit expansion, and the market could reach a total of EUR 10 billion-EUR 15 billion of pre-performing loans returning to the Greek banks in the next three to four years.
Finally, Greek real estate, including RIO activity, is hot and constantly increasing, with prices up by 15% year-on-year. Buying interest comes mainly from foreigners and entrepreneurs, with most transactions taking place in the Archipelago. The auction market is operating quite normally, and the success, and the successful auction ratio is expected to further improve. As loan portfolio management progresses, increasing RIO pools support more out income. Within this positive environment, we have successfully integrated doValue Group into the doValue, doValue Greece into the doValue Group, while transforming a captive servicing unit of a Greek bank in the number 1 player in the NPL Greek market, and a reference for investors looking for opportunities in Greece. In conclusion, I strongly believe that the outlook for Greece, as well as for doValue Greece, will remain positive for the next period. Thank you.
Thank you very much, Cyril, and congratulations to all your team. Moving on to slide five, I would like to provide some color on the turnaround we are seeing on our Spanish business, following the negative impact of the Serf off-boarding. The final economic condition of the Serf contract renewal would have been highly dilutive for our margin, and as such, we decided to not pursue this opportunity further at the last round. As a result, we have been right-sizing our operation in Spain over the last 12 months in order to adjust the cost base to lower GDP and preserve our margins.
The results are now visible. After a number of negative quarters, the PDA in Spain in the second quarter of 2023 has returned to a positive EUR 3.7 million result, delivered in the context of stable revenue, despite 57% lower GDP. Starting from a leaner and topic-focused organization, doValue will actively pursue new market opportunities, focusing on winning new clients instead of relying on the both SLA contracts, while at the same time shifting our business mix from RIO to NPL, following the latest market trends in the Spanish market. On this, let me remind you that Spanish banks, after significant de-risking of the RIO, are still holding EUR 75 billion of NP, almost double the amount of the Italian banking system.
Of significant importance, it is the success rate we are leading with banks, with minor, once a large success, Caixa, first Spanish bank, and Sabadell. Moving to page 6, let's have a look at the performance of our Italian operations. Similarly to what we have done in Spain, we have been actively tailoring our business to the challenging macro context by focusing on improving our collection rates and focusing on costs. This has enabled us to maintain stable collection revenue in the first half, despite a 5.7% reduction in GDP. We are also managing our business with a greater emphasis on RPN, UTP, and filler services and RIO, which provide higher margin, and which now accounts for 53% of our gross revenue, vis-à-vis 22% in the first half of 2022.
The combination of a higher margin business mix and a significant cost discipline, in particular, OpEx reduction, lower NPL outsourcing, and efficiency delivered by our ongoing digitalization and AI investments, enable us to grow our EBITDA margin in Italy by almost three percentage points to 27%. In terms of market dynamics in Italy, we are seeing NPL stock in Italy broadly stable over the last five years, although the mix between banks and funds has shifted significantly towards the latter. This will stimulate a growing secondary market that we at doValue are ready to capture, and we are already capturing, thanks to the success of our Dulu platform for secondary investors and banks. which has delivered accumulated GBD of EUR 3.1 billion in the period 2021-2023.
All in the first half of 2023, we executed satisfactory transactions for an amount of 715 million GBD, double the amount of the whole 2022. It's important to stress that we think these secondary transactions have allow us to manage and retain the servicing mandate of 192% of the GBD. Moving now to more general macroeconomic trends, we are witnessing in our major countries, on slide 7, a reduction in NPE on bank's balance sheets. Not as much driven by the fact that banks are no longer generating NPE, but rather than they've been able to compress NPE thanks to a significant recourse to an efficient and functional ecosystem to dispose and manage NPLs.
In fact, as shown by trusting data on the disposal and banks' balance sheets, it's clear that given the challenging macro context of the last 2 years, and as Italian, Spanish, and Greek banks will now hold more NPEs than at the beginning of 2021, and it is in the context of a sluggish growth of new loans. Please also note that in addition to the NPE held by the banking system, there is now a significant amount of NPE held by state sponsored entities that could or will come to the market. For example, just situation in Greece would increase the potential market by approximately 50%.
In the lower part of the slide, we show some macro indicators captured between 2021 and 2023, that are signaling an increasing economic pressure in Italy, Greece, and Spain, mainly due to inflation, higher interest rates, which is impacting household saving rates. Looking at the PMI index developed by S&P Global, where score above 50 indicate an economic expansion and score below 50 to an economic contraction, both Italy and Spain have seen a material shift from a positive trajectory in 2021 to negative in 2023. Recent data for Italy on GDP in the second half of 2023 marked a contraction of 0.3%.
Increase the PMI index has proven more resilient and remains above 50, mainly thanks to the real estate market, but also growing pressure on household financial conditions. Proven more resilient and remains above 50, mainly thanks to the real estate market, but also growing pressure on household financial conditions. In this context, we believe that the banking system will be tackling any recap in NPE more proactively, not just to the risk, but also to improve ROE and profitability, thus reducing the lag between NPE formation and disposal. We will be seeing much more NPE production, as we have seen already in the second quarter. Moving now to page 8.
We have a pipeline of potential new business of approximately EUR 19 billion over the next 12-18 months, which contains some very large government-sponsored transactions, such as EUR 12 billion project GLAM in Italy and EUR 6 billion Ariadne and project SLBO in Greece. Let me comment on GLAM. From recent interaction with MAPS, the project will continue to be assessed, notwithstanding the management changes in ANCO. It's important to note that doValue is developing a more resilient stream of revenue by refocusing its commercial efforts in securing a larger number of mandates with a lower average size, rather than relying on a few large mandates from a limited number of clients.
On page nine, we have outlined our transformation journey in terms of digitalization, technological innovation, and new capabilities driven by AI, that will boost the productivity of our resources while achieving a significant reduction in cost. The investment we have carried out over the last two years are now ready to deliver their benefits in terms of customer journey and service quality, transforming raw data into knowledge to support decision-making and strategic planning. Streamlining processes and consolidating systems to improve support operations. The new capabilities we have developed will enable our teams to reduce by 55, 40% the time required to look up key information on customer data, while reducing servicing costs by 8%-11% and increasing the annual recovery rate per asset manager by 4%.
We remain highly committed to our ESG strategy, which, as you can see on slide 10, has been declining concrete positive targets for 2023 as part of the group's sustainability plan, for which we are fully on track. Our efforts have been recognized by a number of primary ESG rating providers, which have all improved the rating assigned to the group. Moody's Analytics upgraded its score from limited to robust a few weeks ago. MSCI, MSCI ESG Research upgraded its rating from AA to AAA in March 2023, and Sustain Analytics upgraded the group to low risk and an ESG rating of 19.1. With that, I will now hand over the call to Davide for a closer look to our financials.
Thank you, Manuela, and good morning to all of you. Let's get started. Moving to page 12, we have here a summary of key financials for the second quarter and the first half of the year. As already mentioned by Manuela, the quarter was in line with our expectation and shows significant momentum quarter-on-quarter. We are showing a variation both including and excluding Serf, as is a way, as a very large portfolio, and we think that comparably 2022, excluding Serf, is very accurate to show how the business is performing dynamically. Let me tell you, it is performing well. We have always stated that insurance contract stability would have been low. That is why our top line has been negatively affected by the end. Our EBITDA is growing double digits quarter-on-quarter, even including Serf.
Let's move to page 13 to deep dive on the gross book value dynamics. Our GBV has remained substantially stable since end of 2022 and end of the third quarter, despite a strong performance for collection activity and increasing disposal, mainly related to the Pillar portfolio. This has been possible as overflows from our partner banks grew significantly. That is the same quarter in 2022, and even versus 2021. This is a sign of the rating economic environment, which is translating in a pick-up of NP formation. Our business development efforts are visible in the new mandate for EUR 2.5 billion GBV in a very competitive environment for NPLs servicing, missing jumbo deals of the past.
It is to be noted that in the first half of 2023, the company has won over 10 new mandates, even if of small size, marking a +39% GBV of new business versus the first half of 2022, excluding front year, a great job deal of 6 billion GBV. In general, giving the growing importance of the secondary transaction, we expect the collection profile to become more lumpy, and in the case of 2023, more concentrated towards the second half of the year. The collection rate stands at 4.4% as of the end of June, improving from the 4.1% recorded in the first quarter.
Moving to slide 14, gross revenue in the first half of 2023 declined by 50% year-on-year to EUR 213 million, and by 80.7% in second quarter 2023, recording a significantly less negative trend than the decline in GBV, which was in large part due to the off-boarding of the Serf portfolio. Excluding Serf, the comparison between the first half 2022 and the first half 2023 is almost flat, marking a significant catch-up in the second quarter. Italy, in the first half of 2022, was boosted by higher disposals for about EUR 60 million. Without the disposal, the gross revenues of the region would be mostly unchanged.
The Atlantic region is performing well, thanks to strong collection and growing real business, while gross revenues paid, excluding Serf, are unchanged, thanks to growing new business and a strong flow from Santander. Moving to slide 15, we show the results of our cost discipline measure in sourcing, servicing, and restructuring processing phase. We continue to optimize and reduce our outsourcing activity, leveraging on different portfolio mix of Serf onboarding, as well as insourcing some activities, thanks to efficiency gained with the implementation of new transformation program. Outsourcing fees declined more in absolute terms and as a percentage of gross revenues, positively contributing to sustain our EBITDA margins. We have been extremely proactive in managing our cost base, and this has allowed us to achieve growing EBITDA, even with decreasing revenues for the onboarding of Serf.
We are confident that also thanks to our new transformation program and further headcount optimization, we will be able to achieve our target for EBITDA margins. The HR costs declined both in Italy as well in Iberia, mainly driven by our restructuring program for Serf onboarding. HR costs increased in the Atlantic region, mainly due to the increase in FTEs on the back of the onboarding of the Frontier portfolio. Other operating costs declined at a different rate across the three regions. In Iberia, the new transformation program is particularly advanced and was boosted by the non-renewal of the Serf contract. In order to achieve our targets.
As you can see on slide 16, we have recorded an EBITDA of EUR 80 billion in the first half, down 4.6% year-on-year, with a margin of 35%, 4 percentage points higher than the first half of 2022. The performance quarter-on-quarter has been extremely strong, with a +12% year-on-year, even including Serf, and an EBITDA margin of 39%. Please note that this year reported EBITDA and EBITDA ex NRI are almost identical, if not for 50 or 100 basis points. On page 17, we show the performance across our regions. Adding to what has been already said by Manuela and me on managing the financials.
It is to be noted an improvement collection rate in the Hellenic region and Spain, and a slightly lower collection rate in Italy, 0.1 percentage points, leading to an improvement in the Group collection rate by 0.2 percentage points. Commenting on net income tax NII showed Slide 18, here, the dynamic is similar to the one observed for EBITDA. Strong momentum on the second quarter, with the +27% on net income NII, and negative performance in the first half 2023 versus 2022, which is still affected by a weak first quarter, which are now behind us. Let me remind you that net income, including NII, is affected by higher provision for redundancies. On the redundancies, it is useful to stress that we have a very short payback period for redundancies, which are translating and will translate in a lower cost base.
On the arbitration with Apollo, accounting rules prescribe to account only the negative item of the arbitration decision, but not the positive item of EUR 29 million due to payment of an indemnity for the tax claimed by the seller. As soon as this will be cashed, it will translate into substantial increases in reported net income and the cash flows. Moving to slide 19, in terms of financial position, we generated a strongest flow from operation in the first half of 2023 of EUR 23.34 million, which marks a considerable change from the cash absorption of EUR 6 million observed in the first half 2022. We are particularly satisfied with the effort we have made in managing working capital, which in the first half, we generated approximately EUR 6.3 million of cash.
Dividend payment of EUR 48 million and seasonal tax payment schedule rate, has led to a slight increase of our leverage from 2.2 times to 2.4 times. Please also note that most of our collection fees in Italy for the quarter are paid in July. Interest payment schedule with that fee, the lower end of our financial point range, and one of the lowest in the sector, which allow us to find an ideal balance between shareholder remuneration and growth opportunities via M&A and transformation of countries. Moving to page 20, our financial structure remains solid, with the more than EUR 240 million of liquidity placed between EUR 120 million of cash and EUR 120 million of credit lines as of the end of July. In terms of liability management, our next bond maturity is in 2025.
Our bonds are trading better on the secondary market than our fees on a year to basis. A demonstration of our strateginess, of our capitalized servicing model, also for deputy investor. Please also note that we have decreased our growth debt by repurchasing and canceling approximately EUR 5 million of nominal bonds in the open market, allowing us to reduce the financial charge and booking a more profit on the difference between the average purchase price and the nominal value. I will leave the floor to Manuela for her closing remarks.
Wrapping up our presentation, on page 22, we think the company is now in the right position to capture future growth with a lean structure in all the countries. Future results are a tangible proof that all the action announced and mostly executed in the past year, are yielding strong results in different areas. Lower costs in Italy, return to profitability in Spain, new contracts and strong performance in Greece. Starting from this solid base, we are convinced that doValue will be best positioned to help the banking sector and the FPI industry in meeting the challenges of a very delicate and uncertain macro environment, and play an important role in the upcoming consolidation phase of a mature and yet dynamic FBL ecosystem. We leave now space for your questions.
Excuse me, this is the Costco conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and One on the telephone. To remove yourself from the question queue, please press Star and Two. Please pick up the receiver when asking questions. Anyone who has a question may press Star and One at this time.
I will stay for the question, with the first question from, Simoneta Chiodi from Mediobanca. The floor is yours, Simoneta.
Thank you, good morning, all. The first question is on the outlook for the second part of the year after this positive quarter. If I look at consensus, EBITDA is at EUR 193 million, which implies the second quarter, roughly. The second half, sorry, roughly in line with last year, slightly below, only slightly below. Do you think that this scenario is sustainable? Another question is on the cash flow evolution for the absorption from other assets and liability remained quite strong in the second in the second quarter. Can you give us more more color on on this on this item? Thank you.
Thank you, Simoneta. On the outlook, I would like to refer first to our past performance. I think in 2021 and 20, we have achieved the results, which were above market expectation. We have mentioned during our 1Q results, all the action and the activities we were doing, to deliver our expectations for the year and for the 2Q, which I think for the 2Q have been satisfied. Looking to the consensus and also our previous guidance, we feel comfortable with the what we have been portraying to you so far, also on the back of what we have delivered so far.
On the cash flow, evolution, we try to be very clear on one page, about the composition of all the items. If you look to page 19, you can see that, in the changes, there is a portion, which related to actual parts which do not shift necessarily, from one year to the other, but are, for reporting purposes, aggregated in decline. First, redundancies. Obviously, we had a peak in 2022 and 2023. This will go down, but they represented EUR 6.9 billion.
Second, for Frontier transaction, you remember that we had paid an upfront price, and there was a remaining portion of the price to be paid in the first half of the year, partially from us and partially from the investor, which was delivered. Obviously, this is a one-off, and was included in the initial consideration, as you might remember. The third bullet is around IFRS 16 leases. This will always come through every year because we have rent paid for our offices, basically, most of it, which represents for the first half of EUR 6 million. Then, the NBU and payments and termination benefits of around EUR 5 million.
I think all these elements represent to you a significant portion of the other asset liability change. Regarding working capital, obviously, you have the effect of the Eurobank structure payment. As you remember, although it has decreased over time, the base fee of Eurobank is still paid in advance every year. For the revenue of 2023, the base fee of 2023 is paid in the end of 2022, and this was the same for the previous year. The absolute amount has gone down as part of the contract. Taking out this element, the networking capital, you know, is explained by all this factor. The pure working capital, i.e. receivables and payables, is actually positive.
Okay. We should now move with the second question from Eleni Smailou of Exvent. Please, Eleni.
Hi. Hello, thanks for taking my question. Congratulations for the set of results. Could you give us an update around the secondary transactions in the Hellenic region? You mentioned that the secondary transactions stand at EUR 2.5 billion. We would like some color on how many of these refer to Greece. What's the pipeline ahead for the Hellenic region that we should anticipate? Thank you.
Eleni, thanks for your question. It's, it's, it's great to have Theodore here, who, who can give you, you know, a stronger, you know, with a clear message on, on Greece. Then I can comment on the composition of the secondary sales as part of our new business.
Okay.
Hello. First of all, in terms of the overall dynamic of this market, practically, as you know, in Greece, out of the EUR 100 billion, more or less, of the NPL stock, EUR 60 billion has been securitized under the hub scheme. As part of the management of the business plans of the, of these transactions, the Greek services, with Piraeus Bank being the first one, have started somehow to accelerate the cash collection through the disposal of smaller pieces of these, let's say, legacy mega utilizations. Within this strategy, we've seen a lot of activity, as I said in my commentary.
I mean, up to now, as I said, around, EUR 5 billion have been impacted in, in, up to now. We expect that this will continue. another, another thing, that it's, I would say, is coming to Greece, as I said, is the reperforming loan business. We will talk about it more in the coming, in, quarters.
Given the composition of the new mandates and the flow, I would like to point out attention to page 13. Here you can see that the forward flow has grown a significant amount versus last year, but also quarter-on-quarter. In the new mandate, the total secondary transactions are around EUR 750 million, of which around EUR 550 coming from Greece and the remainder from Italy. For Italy, it's an extraordinary achievement, and it's not typical of this market, where secondary transactions are usually moved to another services are not paid for. In this case, we have a two double effect.
We are achieved SLC, and also we have retained the contract, and we have moved this contract under a new structure with a new investor, which is particularly proactive in new products. In fact, it's focused on RTL transaction. We initiated a new business line on a portfolio of EUR 150 million, which is part of the sales process, on which we are going to bring back to performing with new financing from this investor, a separate pot of loans. Plus, we have selected the out-of-gas scheme, as a selected group of loans, of around between EUR 500 million and EUR 1 billion, where the performing activity can be activated, although they were NPL.
This will create of around between EUR 500 million and EUR 1 billion, where the performing activity can be activated, although they were NPL. This will create, one, a new product line, and second, will be a much more profitable product in partnership with the, a new investor client. This is fundamental because as you have noticed, not only we are stabilizing GDP, we will, we are at 120 with the secured onboarding, which will be finalized by between in the first 15 days of September. We are diversifying our revenue mix, with now more than 50% of revenue, not related to the traditional NPL business.
Thank you very much, and again, congratulations for the results.
Many thanks.
Next question is from Luigi Tramontana of Bank Across. Please, Luigi.
Yes, good morning. Thanks for the presentation. Two questions on my side. Again, on the guidance for this year, given that you have not reiterated that you expect a broadly stable EBITDA of almost EUR 200 million and minimum increase in the dividend of 20%. I would like to know if there's anything new on this front. The second one is more forward-looking on your cost base, given that you have been very effective in restructuring your activities, especially in Spain.
I would like to know your thoughts on the scalability of your platform going on, if you are going to onboard new business, new portfolios, if you think that your cost base will remain broadly stable, or if we have to expect some impact from inflation? Thank you.
Thanks, Luigi, for your question. On guidance, both on EBITDA and dividend, nothing has changed vis-à-vis the past. We are working on our delivery. Clearly, more we progress, and we know that the second half of the year is always a big, a big leap from, you know, the first half. This was through, you know, in 2021, 2022 and this year as well. You know, the second two was particularly important to close this bridge. The dividend obviously, we are not here to, you know, give a specific, no, proposal to the board. It's early on, but in terms of indication vis-à-vis the past, we are not changing anything.
In terms of restructuring in Spain, the effort on the reduction of cost will see a decrease in the next quarter. In the next quarter, we are going to see all the big impact of the exits that we have done in 2022 and in 2020 before it starts. Despite the inflation effect, the decrease will continue steadily. You mentioned an important point in terms of new contracts. This is fundamental. Despite the restructuring efforts of last year and this year, the team has done a great effort to on the commercial side, to gain new contracts. Has done a very successful pilot project with Sabadell on the SME front, which has been transformed into a contract.
We have moved from one, one major bank to two. We are doing a test also with Caixa. We hope to give positive news by the end of the year for a new contract. We eventually will move to three major banks in Spain. On top, we have added also two small Caixa locally. On the, on the, on the flip side, we have continued our efforts on the investor side, because as you have seen, the production of NPLs in Spain is sustained, also both on the flow and also.
On the on the flow contract with the Altamira, with Santander, and also on the sales side. Obviously, these are small transactions, but we have added 3 investors this year. In terms of resources for these new businesses, clearly, they will require, you know, new resources. Net-net, the HR cost will be going down as mentioned. The new ambition will be less than the decline. This is because Sareb was a demanding client on the standpoint of both resources and systems. They wanted dedicated resources, so we limited the ability to do efficiencies across portfolios, and also dedicated the systems, which now we have taken off and transformed.
On the, on the flip side, clearly, we had legacy personnel, which was transferred to us originally, which now we have been able to restructure and choose for this new business, new personnel from the market at more competitive costs.
Okay, many thanks.
Andrea Visi of Equita. Please, Andrea, go ahead.
Hi, thank you for taking my, my question. The first ones are on Italy. Just to, to understand a bit the dynamic of revenues and EBITDA in the quarter. We see that the recoveries are in second quarter 2023 versus 2022, are broadly stable, slightly up, but servicing revenues are down by 20%, if I'm not wrong. So, to understand if there is some seasonality, if there is some effect here that was not taking into account. Also, maybe in second, the, the base of comparison was, was tougher with second quarter 2022, really, really strong. So what to expect going on, on the servicing revenues on in general, gross revenues in Italy, going, going on?
Also, also in Italy, if I look at cost, there is an increase in, in cost between the first quarter and the second quarter. To understand which could be considered a normalized level of, of cost here, or if you can provide us, guide us on cost on Italy for, for the full year. The second, second question is on the, the collection rate, which improved in, in the half, in the quarter. Just to understand, how do you think, what do you think is the level of collection rate that you think is, is, is sustainable, especially in Hellenic region and Iberia, considering that these are the region where it grew the, the most.
In particular, if you can repeat maybe to what, which was increased the contribution to the collection of the transaction we made in the secondary market, where you have managed the disposal of MP, and then you have taken back the mandate from a new or new investor. If you can provide us an update here on the level of fees in comparison with the fees that were received from previous, from previous investors. The last question is on the restructuring cost, if especially regarding personnel, is it reasonable to assume that most of them are already expensed, or if there is something else in the second part of the year? Thank you.
Hello, Andrea. David. On Italy, as we already commented in our speech, last year, we had around EUR 6 million of indemnities that was, you know, increasing the revenues versus the collection. This is explained the debt, the main debt. The difficult part is related to the lower performance in terms of volume, because in Italy, we were affected by the environment related to the high interest rate and high inflation. We, as, as we say, we are working to increase the revenues from the ancillary revenues to counterbalance the reduction in terms of collection. We are also switching versus product like the UTP, where we will, we will have a higher margin. This is very important.
At the same time, we are working, as we said, on the cost side. The first quarter, the first quarter, the reduction cost was higher, as we explained in the past, and also because we have a positive effect after the exit of the CEO. This, this, impact also positive the, the, the full year, because, as you know, the salary package of the CEO was important, and also the, the new one will be lower, so we will have a positive impact on the cost side.
At the same time, on the cost side, we are also in Italy, doing, efficiency, reducing, reducing, the number of CTs through an incentive scheme, voluntary acceptance scheme with the people that will reduce our, our cost base. The last is very important, is the, outsourcing cost. As we commented, the outsourcing costs are reducing because we are internalizing some activities that we used to do.
External. This also thanks to the all the investment we, we have done with the good automation power that give us the opportunity to do some the activity that we used to do external with the internal people without increasing the internal cost. This is from the Italian side. In terms of collection rate, as you can see, in Italy, we are, we are quite stable. We are continuing to perform well in investors GPD we are managing.
Moving now to the collection rate for the full group. We are in the positive trajectory that we had highlighted in our business plan. Clearly, you know, 2023 being affected by the macro environment, has an impact, has had an impact. We have tried to achieve the, you know, same result in terms of revenue by diversifying even further the revenue base. In terms of the Hellenic region, it's probably where the impact is less, in the, in the sense that macro, due to the specific latest event, has an impact which is minimal compared to the stronger, you know, trajectory from where the Greek country is coming from.
The 6.8 you see here, probably for the full year, will be definitely above the 7 mark. On the Iberia region, if you take out already have seen the growth, and this has been a clear objective of the local management, to increase the productivity of the parent workforce. Despite the lower number of people, even on a like for like perimeter, they will continue to be more profitable on in terms of collection rate, both on the Santander portfolio and on the portfolio of investors, with dedicated team and the strengthening of the portfolio team. Portfolio team, just to explain for you, these are specific teams who are analytic, who do analytics around how to extract value from portfolio, as supporting the asset managers. The positive news is around fees.
Uh, usually, uh, the fees were translated in the sales transaction are either the same or better. Uh, in fact, in Italy, we have sold portfolio, uh, again to, uh, new, uh, investors, which maintain with us the portfolio, and we have better fees from the new investor. Because investors realize that especially in a challenging market, uh, in terms of macro, it's very important to incentivize the, uh, asset, uh, the asset manager and the com- and the service to do better. So on the, on the, on the fee side, uh, we must say that, uh, we are positively, uh, surprised. Uh, on the Hellenic, uh, front, the contribution of, uh, secondary, uh, to, uh, the total revenue, uh, is, uh, around probably five to six percent of, uh, uh, the first half, uh, figures for, uh, for the, for the region.
On the restructuring cost in Spain, the process related to that has completed, as we had promised in June. We have done an additional analysis of efficiencies in the month of July that we would like to pursue in the second half of the year. We also had planned already an initiative in Greece. There will be some more in the second half, but less than in the first, in the first half.
Thank you.
We have the next question from Filippo Crini of Kepler. Please, Filippo, go ahead.
Good morning. I've got a couple of questions on gross value. The EUR 3.6 billion of new mandates not yet on board. Should we expect them to be boarded by end of the year or later stages? Still on the evolution of the gross value, in the first half, mainly the second quarter, there's been basically the loss coming from the disposal of principles of contract for different reasons, board misses, and so on. Should we expect something similar also in H2? Just to have an idea if at the end of this year, the gross value could be above the EUR 117 billion that you reported in June, bar these new mandates not yet boarded. Thank you.
Thank you, Filippo, for your question. The $2.6 billion have a name, have a name, there are two, two contracts, one in Cyprus, which will be onboarded on the 18th of September, and one in Greece, which will be onboarded at the end of the year. These have already the one contract signed and everything else, so it's only a question of IT and transmitting files. In terms of guidance, you know, for the GDP, we had, in the business plan, we were flat. We were, we hope to do better, but we confirm the flat trajectory. Although I must say that the commercial effort is very, is very high. We hope to have continuous positive news as we have had in the second two.
We are less re- doing press releases on the new announcements because they are more numerous and smaller in size. It's a question of opportunity also for you to not receive too many emails. That's why we have consolidated them in in in this report. You can imagine the commercial effort on, you know, one contract of EUR 2 billion rather than ten contracts for EUR 2.6 billion, it's, it's much wider and intense. Though depending that, the team is very focused on growing contracts.
Thank you.
Thank you all for attending, our earning call. That was all for today. Thank you, and.
Have a great summer!