European NPL transaction volumes are expected to stabilise during 2026 following several years of balance sheet clean-up by banks across the region. While the large-scale portfolio disposals seen after the financial crisis have largely subsided, transaction activity remains steady in a number of jurisdictions.
Market participants report continued deal flow in SME, consumer unsecured and selected real estate-backed portfolios. In addition, some banks are increasingly exploring sales of re-performing loan portfolios as part of ongoing balance sheet optimisation.
Investors remain active across the European distressed credit market, particularly those with specialised servicing capabilities and sector expertise.
Market implication
A steady pipeline of targeted NPL and re-performing loan transactions is expected to continue supporting the European secondary market.
Sources: European NPL market research reports.