Portugal is concerned about over-dependence on Spain in its banking sector and views an acquisition of its fourth-largest lender Novo Banco by a Spanish bank as contrary to the country’s interests, its acting Finance Minister said.
According to Spanish media reports, the country’s Caixabank, which owns Portugal’s fifth largest bank BPI, was weighing a bid for Novo Banco, although the Spanish bank has not commented on those reports.
“Spanish banks already represent roughly a third of the Portuguese banking market and, for reasons of concentration and dependence, this figure should not rise,” Joaquim Miranda Sarmento told broadcaster RTP late on Wednesday.
“It is in the country’s interest that there is no excessive dependence or concentration in our banking sector in the hands of banks from a single country such as Spain,” he said, without elaborating why it would be of concern.
Unlisted Novo Banco, which is 75% owned by U.S. private equity fund Lone Star, in February began preparations for an initial public offering of 25%-30% of its capital but a full sale has not been ruled out.
Miranda Sarmento said it was up to majority stakeholder Lone Star to decide on whether float the bank or sell it. The remaining 25% stake in the lender is held by a resolution fund, which is financed by Portugal’s banks and the Portuguese state.
While the stake does not allow the state the power to block a deal, it would be difficult to finalise it without the government’s consent.
Last June, the CEO of state-owned Caixa Geral de Depositos (CGD) Paulo Macedo said Portugal’s largest bank was considering buying another lender to preserve its market leadership in the face of expansion by foreign banks, particularly those from Spain.
Should CGD make a bid “alone or together with another bank” for Novo Banco, the Portuguese state would have the final say on the transaction in such a scenario, Miranda Sarmento said.
Portugal’s top five banks, which also include Millennium bcp and the Portuguese unit of Spain’s Santander control more than 80% of the country’s banking assets.
(Reporting by Sergio Goncalves)
