Novo Banco to complete sale of 25% of GNB Seguros

  • ECO News
  • 16 September 2020

The Portuguese bank is preparing to close the sale of its 25% stake in GNB Seguros to Crédit Agrícole Assurance.

Novo Banco is expected to announce the sale of GNB Seguros soon. The bank is preparing to close the sale of its remaining 25% position in non-life insurance to the French company Crédit Agrícole Assurance, which already holds 75% of the company’s capital, ECO found out from a source.

With this operation, the bank led by António Ramalho will fulfil the 33rd and the last of the commitments that the Portuguese State signed with the European Union in 2017. This agreement provides for the divestment of Novo Banco into non-strategic assets by the end of 2021. Officially, the bank does not comment, although António Ramalho has already given some hints at Tuesday’s parliamentary hearing.

“The strategic plan had 33 objectives to be met by 2021. And we have met 32 of the 33. We hope to meet the 33 this month,” said the president of the Novo Banco. The sale announcement could be made later this week.

GNB Seguros (ex-BES, Insurance Company) was created in 1996 and currently has as shareholders Crédit Agrícole Assurance (75%), Novo Banco (24.9934%), GNB Gestão de Ativos (0.0033%) and Banco Best (0.0033%). In other words, the French will now control 100% of the national insurance company.

This insurer operates in the non-life insurance market segment for private individuals (labour, motor liability, health and fire insurance).

This company is distinct from GNB Vida, which was sold by Novo Banco to Apax funds, in a transaction that turned out to be controversial because of the losses it generated and the possible links of the buyer to an entrepreneur (Greg Lindberg) who was convicted of corruption in the USA. These concerns have already been cleared up by both Apax and the bank.

This time, the sale of GNB Seguros should not generate suspicions regarding the final beneficiary, bearing in mind that Crédit Agrícole Assurance is part of the French Crédit Agrícole group.

The transaction takes place after Novo Banco was prevented from selling assets as a result of the controversy over property sales and GNB Vida. However, after the Portuguese Prime Minister asked the Public Prosecutor’s Office to investigate these operations, the Attorney General’s Office concluded that the documentation it analysed found no evidence for the accusations made against the bank. With this clarification, the bank considered that António Costa’s impediment to the sale of assets was lifted.