- Title: Portugal sells Novo Banco to Lone Star for 1 bln euro capital injection
- Date: 31st March 2017
- Summary: LISBON, PORTUGAL (MARCH 31, 2017) (REUTERS) PORTUGAL'S PRIME MINISTER ANTONIO COSTA AND FINANCE MINISTER MARIO CENTENO ENTERING NEWS CONFERENCE ROOM REPORTERS AT NEWS CONFERENCE (SOUNDBITE) (Portuguese) PORTUGAL'S PRIME MINISTER, ANTONIO COSTA, SAYING: "Today, following Espirito Santo bank resolution of August 3rd of 2014, the Bank of Portugal decided to sell Novo Banco to North American investor Lone Star." NEWS CONFERENCE IN PROGRESS (SOUNDBITE) (Portuguese) PORTUGAL'S PRIME MINISTER, ANTONIO COSTA, SAYING: "The operation has removed the prospect of a liquidation. Novo Banco's future to carry out its role of financing the economy is guaranteed." NEWS CONFERENCE IN PROGRESS (SOUNDBITE) (Portuguese) PORTUGAL'S PRIME MINISTER, ANTONIO COSTA, SAYING: "There will be no direct or indirect impact on public accounts or any new charges for taxpayers. Unlike the first proposal (by Lone Star), the state will not give any guarantee or any other public entity." NEWS CONFERENCE IN PROGRESS (SOUNDBITE) (Portuguese) PORTUGAL'S PRIME MINISTER, ANTONIO COSTA, SAYING: "This is, therefore, a balanced solution and the one that better protects tax payers, the economy and the stability of the financial system under the resolution that began in August 2014." NEWS CONFERENCE IN PROGRESS EXTERIOR OF NOVO BANCO HEADQUARTERS VARIOUS OF SIGN READING "NOVO BANCO" EUROPEAN UNION, PORTUGAL AND NOVO BANCO FLAGS VARIOUS OF NOVO BANCO HEADQUARTERS WOMAN WITHDRAWING MONEY AT ATM MACHINE ENTRANCE OF NOVO BANCO BENCH VARIOUS OF BANNER READING "NOVO BANCO" NOVO BANCO HEADQUARTERS SIGN READING "NOVO BANCO" NOVO BANCO HEADQUARTERS
- Embargoed: 14th April 2017 20:54
- Keywords: Portugal Lisbon Novo Banco capital sale euro Lone Star
- Location: LISBON, PORTUGAL
- City: LISBON, PORTUGAL
- Country: Portugal
- Topics: Company News Markets,Economic Events
- Reuters ID: LVA0016AALDAL
- Aspect Ratio: 16:9
- Story Text: Portugal has agreed to sell a 75 percent stake in state-rescued lender Novo Banco to U.S. private equity firm Lone Star in exchange for a capital injection of 1 billion euros into the institution, the government said on Friday (March 31).
The sale was carried out ahead of an August deadline agreed with the European Commission and closes a banking saga which started with the collapse in 2014 of Banco Espirito Santo, at the time Portugal's largest private bank.
Portugal injected 4.9 billion euros into the BES rescue, which at the time was the first such collapse to fall under new European rules on operations for failed banks.
Prime Minister Antonio Costa said the sale fulfilled a key criterion of not extending any state guarantees to the buyer, as had been raised earlier in the negotiations with Lone Star, and guarantees Novo Banco's future.
Under the deal, Portugal's Bank Resolution Fund will retain the remaining 25 percent stake in Novo Banco, which is the bridge bank carved out of Banco Espirito Santo, which collapsed in August 2014. The country injected 4.9 billion euros, mostly via the resolution fund, into the "good bank".
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