Pedro Alves opens the door to Mutualista. “I have never turned my back on any solution” at Montepio

Associação Mutualista Montepio Geral (AMMG) is heading for elections at the end of the year. It already has a declared candidate, Virgílio Lima, but this is unlikely to be a solitary race for the renewal of the mandate. Others are lining up to challenge him, and there may be not one, but two challengers: Miguel Coelho, the candidate of a group of associates who opposed Tomás Correia, but there may also be a list headed by Montepio staff, with Pedro Gouveia Alves emerging as an option. To ECO, he does not anticipate a decision but does not close the door to being part of the solution to the challenges that need to be overcome.

“I have never turned my face to any solution in the Montepio Group,” he says in an interview with ECO, when asked if he might become part of the solution for the Mutualista’s leadership. “Whenever I was invited to be part of solutions within the Montepio Group, I always said yes. And I’ve always said yes, it’s been 22 years now,” the CEO of Montepio Crédito adds.

And what may motivate him are the challenges that AMMG faces. “The AMMG has a set of challenges that we will surely be able to overcome,” he says confidently. When he says we, he means the Group. “All of us. The entire Group. I am a part of the Group,” explains the head of the specialised financing entity of Banco Montepio.

But would it be natural, bearing in mind this commitment to help AMMG, to launch himself into the leadership race? I will not anticipate any decision here”, he concluded, leaving a “let’s see…” as to whether he will make a decision on a possible candidacy in the near future.

Pedro Gouveia Alves is one of the two names in pole position to lead an eventual candidacy that will gather strong support amongst the institution’s staff. The other is Pedro Líbano Monteiro, from Montepio Valor.

Pedro Leitão “is doing the best job possible” at Banco Montepio

It is not only AMMG that faces a troubling context. Banco Montepio, which is almost totally controlled by AMMG, is also going through hard times, registering heavy losses due to the provisions it had to make for potential damages caused by the pandemic. Pedro Gouveia Alves knows this is the case, but he trusts the work of the CEO.

Pedro Leitão has “many challenges ahead,” says the head of Montepio Crédito. “But I know he is doing the best job possible” to bring Banco Montepio to a successful path.

“I think he [Pedro Leitão] has been… There are several challenges here that came from behind and have to do with the actual management of the credit portfolio’s quality, including the changes that all retail banking is facing: digitalisation, automation, changes in the banking market… low-interest rates,” he says in a conversation with ECO.

“There are several challenges I believe the management team is seeking to overcome so that Banco Montepio can grow positively in the future,” says Pedro Gouveia Alves.

Montepio Crédito helps enhance the bank’s value

“Banco Montepio had to make a significant amount of impairments, like other banks. And so did we [Montepio Crédito],” but the end result is different. “In 2019 we had €800,000 in impairments. In 2020, we had €2.3 million, and we still had a positive result. It was an extraordinary year: profits increased, it also grew in the loan portfolio, in market share…,” he explains.

Montepio Crédito “has been growing a lot since it was acquired as part of the Finibanco takeover in 2010”. “Since 2012 this institution has always made money. It has always had positive results and with a return on equity that is very significant: above 8%, 8.2% in 2020.”

The specialised credit institution had €4.1 million positive net results in 2020. This year, “we are up 15% year-on-year, both in the evolution of funding production and profitability indicators. We are with a level of results around 15% higher than the same period last year, this is data up to April.”

“Montepio Crédito, which had equity of €19 million in 2011, ended last year with €59 million, but is now above €60 million,” he tells ECO. And it is in this regard that Pedro Gouveia Alves says Montepio Crédito adds value to Banco Montepio.

“Do we add value to the group? Yes. If equity grows, the valuation of this asset in the bank’s consolidated balance sheet also grows. I would say that Banco Montepio has a safe, profitable asset in Montepio Credito that helps to increase the value of its asset portfolio,” Pedro Gouveia Alves concludes.