Bank of Montreal is exploring sale of RV loan portfolio - Bloomberg News

(Reuters) -Bank of Montreal is exploring the sale of a portfolio of recreational vehicle loans, Bloomberg News reported on Tuesday, citing people with knowledge of the matter.

The face value of the portfolio is at least $5 billion, the report said, adding that the Canadian lender is in discussions with potential buyers including credit arms of alternative asset managers.

The potential sale comes at a time when several banks in North America shed loan portfolios to bolster balance sheets in the face of a 'higher-for-longer' interest rate environment.

"We can't comment on specifics of a transaction," a Bank of Montreal spokesperson told Reuters in an emailed statement.

The sale of loan portfolios, particularly those which are rate-sensitive, allows lenders to manage risk and keeps credit loss provisions or capital set aside to cover potential defaults in check.

(Reporting by Manya Saini in Bengaluru and in Nivedita Balu in Toronto, additional reporting by Jaiveer Shekhawat; Editing by Shailesh Kuber)