Deutsche Bank sells retail business in Portugal to the Spanish Abanca

Deutsche Bank has come to an agreement to sell its retail business in Portugal to the Spanish bank Abanca. The operation was announced this Tuesday by the German bank, which assures it will maintain its presence in Portugal by means of its branch.

The operation, whose amount was not revealed, is still subject to the approval from European regulation authorities, “among other operational conditions”, the bank stated, in a press release sent to newsrooms. “The parties are aiming to close the transaction in the first half of 2019”, the press release adds.

Abanca, former NovaGalicia, is present especially in the North of Spain, and it has a total of 640 branches and over 4,600 employees. In Portugal, the Spanish bank already operates by means of four branches, with a business model mainly focused on small and medium enterprises. “The transaction is part of ABANCA’s international strategy to strengthen its presence in Portugal and grow in the strategic segments High Affluent and Private Banking, which will complement its existing business”, the press release points out.

Deutsche Bank assures that it “remains firmly committed to Portugal and will remain present with its operations in Corporate & Investment Banking including Global Transaction Banking, providing banking services to Portuguese and international corporate clients, financial institutions as well as government agencies”.

Abanca states that the purchase of Deutsche Bank’s retail businesses in Portugal will allow it to have “a 5% improvement in the intermediation margin and a 20% increase in commissions”. Deutsche Bank in Portugal has a credit portfolio of 2,400 million euros, one billion in deposits and 3,100 million in assets under management, numbers that raise Abanca’s business volume to 6,500 million euros. The commercial network now acquired by Abanca has 41 centers, located mainly in Lisbon and Oporto.