At a press conference in Lisbon presenting the first quarter results, which showed profits of 393 million euros, Paulo Macedo responded to multiple inquiries regarding Caixa Geral de Depósitos’ (CGD) potential acquisition of Novo Banco.
Macedo reiterated his reluctance to comment further, highlighting the absence of any new developments, and noted that it is uncommon for any organization to disclose their strategic intentions during a press conference. “I don’t see anyone disclosing in a press conference whether they are going to buy Novo Banco or not,” he stated.
Despite this, Macedo outlined various scenarios that could involve the public bank. He acknowledged that if CGD were to acquire the entirety of Novo Banco, it would become a significantly large entity under competition rules, necessitating ‘remedial measures’ to reduce CGD’s size. “You know the competition rules, there would be significant concentration that would lead to several remedies, an enormous set of remedies would be needed,” Macedo explained.
Macedo mentioned that there are “other alternatives” that CGD would explore, though he did not specify further. When asked about CGD’s interest in expanding in the corporate share, potentially through acquiring operations in that sector, and whether this could involve buying part of Novo Banco, he remarked, “That separation [of Novo Banco’s activities] would be complex.”
While he refrained from providing precise details on CGD’s future actions, Macedo assured, “Caixa will not be the Nêspera,” referencing a poem by Mário Henrique Leiria, implying that CGD will remain active amidst industry movements.
A verse of the poem reads, “A nêspera was in bed/lying down/very quiet/observing what happened/the Old Lady arrived/and said/look a nêspera/and ate it/that’s what happens/to nêsperas/that lie down/quietly/waiting/to see what happens.”
Addressing Finance Minister Miranda Sarmento’s recent comments that it would be unfavorable for the Portuguese banking market if Spanish presence increased, amidst rumors of Spanish CaixaBank’s interest in Novo Banco, Macedo highlighted a long-standing concern. “I don’t think it’s healthy for Portugal to have 50% of the banking sector in Spanish hands,” he commented.
Macedo also expressed confidence in presenting proposals they deem crucial for business with the current and previous governments. Discussing CGD’s overcapitalization, he suggested that with surplus capital, the public bank would either invest or distribute more dividends to its shareholders.
CGD, which reported 393 million euros in profits for the first quarter, is wholly owned by the state.
Novo Banco’s majority shareholder, Lone Star, has announced plans to sell part of the bank this year. With Lone Star holding 75% of the institution and the Portuguese state holding 25% (13.54% by the Resolution Fund and 11.46% by the Directorate-General of the Treasury and Finance), there is a need to determine if the government and the Resolution Fund will also proceed to sell their shares on the stock market.
Earlier this year, it was reported that Lone Star is valuing Novo Banco at 5 billion euros. In June 2024, the Resolution Fund purchased an additional 4.14% of Novo Banco from the state for 128 million euros, raising its stake to 13.54%, which valued the bank at over 3 billion euros.
