António Ramalho: ECB has given their green light. The sale of Novo Banco “is close”

António Ramalho, Novo Banco’s CEO, has stated this Wednesday that the North-American fund Lone Star has been given the green light by the European Central Bank (ECB) to purchase the transition bank. He believes the operation will be concluded very soon: “The operation is now between buyer and seller, the bank only helps making it possible (…), but the enthusiasm I see in the buyer and the competence I see in the seller will surely assure the sale will be done in a very short time frame”, António Ramalho told Lusa.

This Wednesday, Novo Banco announced the debt repurchase offer, aiming to save 500 million euros, has been concluded. The operation was one of the key terms for concluding the sale of Novo Banco to Lone Star, whose contract had been signed last March, but should now happen until October 20.

However, the CEO is convinced the negotiation could be concluded before that deadline: “It is very close to being finished“, he stated. In addition to this operation do decrease Novo Banco’s liabilities, the sale needs the authorization of European regulators and supervisors to be concluded. When asked about ECB’s “green light”, he stated that multiple authorizations are needed, and several have arrived — such as the one saying Lone Star can purchase Novo Banco.

"ECB needs to issue many authorizations. There is one for new articles in statutes — we have it. There is one for new members in the Board– it is ongoing. There is an approval for Lone Star to be the buyer — we have it. There is one authorization for the capital and liquidity to be authorized by ECB, and we have it.”

António Ramalho explained: “ECB needs to issue many authorizations. There is one for new articles in statutes — we have it. There is one for new members in the Board — it is ongoing. There is an approval for Lone Star to be the buyer — we have it. There is one authorization for the capital and liquidity to be authorized by ECB, and we have it”.

As for the European Commission’s DGComp approval of Novo Banco’s restructuring plan — also a key term to conclude the sale –, Ramalho states a “final formalization” is still lacking. “That issue concerns Lone Star and the Portuguese Government, we know a letter of commitment has been signed by the Finance minister and we are waiting for the final formalization”, he stated.