With SDR status, Hoist Finance is exempt from the backstop regulations (EU 2019/630) and no longer needs to make deductions for insufficient coverage of non-performing exposures when calculating its capital base. As of today, Hoist Finance has made such deductions of SEK 1.2 billion, which can hereby be dissolved. The capital will instead be used for growth and capital repatriation to shareholders.

Harry Vranjes, CEO of Hoist Finance, comments: “SDR status increases our addressable market, simplifies our business model, gives us greater flexibility in portfolio acquisitions, and strengthens our cost efficiency. By introducing the SDR definition, regulators recognise the need for stable and regulated buyers and managers of non-performing loans to support the European banking system. This is a recognition of Hoist’s business model and the values we create. We will continue to grow with the same strategy as before, progressing on our route to becoming the leading investor and manager of debt portfolios in Europe."

Regulatory context
In 2019, the European Banking Authority (EBA) implemented the so-called backstop regulations (EU 2019/630), which impose requirements of CET1 deductions for non-performing exposures held on banks' balance sheets according to a predefined calendar.

The purpose of the backstop regulations is to prevent a build-up of Non-Performing Loans (NPLs) in the European banking system by regulating so that adequate provisions are made to cover potential credit losses. For unsecured loans, provisions covering 100 per cent of the value of the loans must be made within three years from the first signs of distress.

In 2025, a new banking package came into force, which includes a section on regulated Specialised Debt Restructurers (SDRs) that are exempt from the backstop regulations, as their main purpose is the management of NPLs (Article 36.5 of Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and amending Regulation (EU) No 648/2012, the so called Capital Requirements Regulation; CRR). Banks and credit market companies that meet the full criteria can now qualify as SDRs. The conditions include specialisation in debt management, a stable financing model and high liquidity requirements (SDRs must maintain a Net Stable Funding Ratio (NSFR) above 130 per cent). The conditions aim to create SDRs that remain stable and strong also through market turmoils and banking crises, when buyers of NPL-portfolios are needed the most.