Montepio Group reports losses of €15.6 million due to two Russian companies
Montepio held €21.5 million in debt from a gas company and another Russian metal-mechanics company. War forced impairments of €15.6 million that the group hopes to reverse, at least partially.
Montepio group recorded a loss of around €15.6 million with exposure to two Russian companies, one a gas company and the other a metalworking company, following Russia’s war in Ukraine, which began over four months ago.
At stake is an investment that was valued at €21.5 million at the end of last year, but which, “after the start of the war and after various sanctioning measures being implemented by Western countries to Russia”, became worth only €5.9 million in May, with the mutualist group led by Virgílio Lima recognising a loss close to 73% of fair value, according to the bank’s financial statement for 2021.
Associação Mutualista Montepio Geral (AMMG) clarified to ECO that that exposure “is distributed by two entities of the group, but not in Banco Montepio” and hopes, “at least partially”, to recover the value of the impairments.
It also assures that the two group entities “have been receiving the interest due”, in other words, there is still no default on debt service by the two Russian companies that have not been identified. Besides the bank, its main asset, AMMG owns the insurance companies Lusitânia and Lusitânia Vida and other companies.
The exposure of the Portuguese financial system to Russia and Ukraine is “negligible,” “and the exposure of credit institutions to companies with business relationships with these two countries is small,” the Bank of Portugal said in its Financial Stability Report published on Friday.
