Pimco Acquires €450M Re-Performing Mortgage Portfolio from CaixaBank

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Pacific Investment Management Co. is on the verge of finalizing a deal to acquire a €450 million ($525 million) mortgage portfolio from CaixaBank SA. The portfolio, known internally as Project Falkor, includes around 7,000 re-performing loans.

Deloitte has been acting as an advisor to facilitate the transaction.

CaixaBank, Spain's third-largest lender, is actively working to reduce its risk exposure by selling loan portfolios. The bank has been engaging in multiple risk transfer deals throughout 2025, with this deal being one of several aimed at offloading risk from its balance sheet. This strategy reflects a broader effort to streamline the bank's portfolio.

The mortgage portfolio in question is among the latest in a series of transactions involving CaixaBank. Earlier in 2025, the bank sold a €600 million portfolio of soured mortgages to Apollo Global Management Inc. The ongoing efforts highlight a strategic shift for the lender to reduce its exposure to non-performing assets.

Market Moves and Strategic Shifts

Pimco's involvement in these deals is part of a larger trend in European credit markets. The firm has previously partnered with other investors in similar transactions, including a €460 million mortgage portfolio from Banco Santander SA in a deal led by Goldman Sachs Group Inc. These deals are reflective of broader investor interest in re-performing European real estate loans.

CaixaBank has made it a priority to accelerate its risk transfer initiatives in 2025. The bank has even formed a dedicated team to streamline and speed up these transactions, according to its CFO, Javier Pano. The cumulative potential of these deals could amount to around €8 billion in notional value by year-end, making it one of the most active banks in the risk transfer space.

This deal with Pimco underscores CaixaBank's ongoing strategy to reduce its risk exposure while optimizing its capital structure. The re-performing loans in the portfolio are seen as attractive to investors, particularly in a market where interest in high-yield and distressed assets remains strong.

Why This Deal Matters for Investors

For Pimco, the acquisition aligns with its strategy to expand its presence in European credit markets. The firm has shown a willingness to invest in re-performing loan portfolios, which offer the potential for higher returns compared to traditional fixed income. The current economic climate in Spain, with its relatively stable housing market and low interest rates, makes such deals particularly appealing.

The broader trend of risk transfers in the European banking sector is expected to continue in 2026. With regulatory pressure and capital requirements pushing banks to offload risk, demand for re-performing portfolios is likely to remain strong. Investors with a focus on European credit are likely to keep a close eye on these developments, as they offer opportunities to diversify and potentially enhance returns.

The implications for CaixaBank are equally significant. By continuing to reduce its exposure to non-performing and soured assets, the bank is positioning itself to strengthen its balance sheet. This, in turn, could lead to improved credit ratings and a more stable financial outlook in the coming years.

Broader Banking Sector Trends

The CaixaBank-Pimco deal is one example of a growing trend in European banking. Across the region, banks are increasingly turning to risk transfer and loan sales to manage their portfolios more efficiently. The trend is particularly evident in countries like Spain and Italy, where banks have historically held large portfolios of non-performing loans.

In addition to CaixaBank, other major European lenders such as Banco Santander and BNP Paribas have also engaged in similar transactions in recent months. These efforts reflect a broader shift in the European banking landscape, where the focus is moving from simply holding risk to actively managing and mitigating it.

Looking ahead, the continued success of these risk transfer initiatives will depend on factors such as regulatory support, market demand, and macroeconomic conditions. For now, the deal between Pimco and CaixaBank highlights the ongoing transformation of European banking and the evolving role of asset managers in the credit market.