BCP will assess Novobanco, not interested in buying part on bourse

BCP’s chairman said on Thursday that the bank would not participate in a partial purchase of Novobanco shares but that in a possible direct sale, it would assess whether the acquisition would bring it advantages.

On the sidelines of the Century 21 property conference in Lisbon, asked by Lusa about BCP’s interest in buying Novobanco, Miguel Maya said that BCP has a strategy based on growth without acquisitions. Even so, he reiterated that the bank also should look at Novo Banco as it would any other bank that was put up for sale and consider the option of acquisition.

“BCP has a strategy based exclusively on organic growth […] If the price is right, if it creates value for shareholders if it makes sense for the Portuguese economy, we can consider it. But we don’t need that”, he said.

Maya emphasised that BCP has a market share close to 20%, ‘high efficiency and adequate profitability’ that allow it to make an investment only if it ‘unequivocally creates value’.

As for whether BCP is only interested in a direct sale of Novo Banco or whether it could also acquire Novo Banco shares when it goes public, Maya was adamant that the bank would not take part in an IPO (Initial Public Offering).

“It doesn’t make sense for any institution to buy part of another. What does make sense, if it were to make sense, would be to consolidate in order to find product efficiencies and operational efficiencies“, he said. However, BCP’s executive chairman also considered that it was possible to first disperse Novo Banco’s capital on the stock exchange and “later consolidate processes“. “They are not incompatible“, said Miguel Maya.

As for whether it would be more favourable for the Portuguese authorities to have BCP buy Novo Banco than a bank of Spanish origin (bearing in mind that Spain’s preponderance in Portuguese banking is a recurring political theme), Maya said that his concern is the interest of the bank he leads.

“My concern isn’t what the Portuguese authorities think, it’s what the shareholders think and what’s best for the bank”, he said. As for BCP having a team dedicated to Novo Banco, Maya said that BCP has teams that permanently ‘monitor all the banks in Portugal’, including Novo Banco.

Novo Banco was set up in 2014 to take over part of Banco Espírito Santo’s (BES) banking business when it was resolved.

In 2017, 75% of the bank was sold to a US investment fund. The state directly and indirectly holds 25% of Novo Banco’s capital (the Resolution Fund holds 13.54% and the state holds 11.46% through the Directorate-General for Treasury and Finance).

According to public information, Lone Star’s objective for now is to sell part of Novo Banco’s capital (25% to 30% of the capital) and is preparing a dispersal on the stock exchange (through an IPO). However, sources in the financial sector say that a direct sale of the whole of Novo Banco has not yet been ruled out. In this case, if the buyer were a bank already present in Portugal, it would lead to a merger.