Novo banking comes to Portugal
It took the collapse of Banco Espírito Santo, rather than the eurozone crisis, to redraw the map of Portuguese banking. Will the revised landscape show Iberian consolidation, or a new Chinese foothold on the continent?
When Spain’s Caixabank made a full takeover bid for BPI in the middle of February, it caught many people off guard.
Caixabank’s existing 44% stake in BPI, Portugal’s fourth largest bank, had been overlooked in the saga of the shake-up of the country’s banking industry following the collapse of its third-ranked financial institution, Banco Espírito Santo.
We can assume that BPI or Santander would be looking to capture synergies of about €500 million
Indeed, up to this point, the dominant topic of discussion in Lisbon’s financial circles revolved around who would win the bid for Novo Banco, the ‘good’ bank created from the downfall of BES.
BPI had been a strong contender to land Novo Banco. But a three-way merger – even if led by Caixabank, which has proved itself a tremendous and solitary success story following turmoil in Spain’s savings bank sector – might just be a merger too far.
In a crowded field of bidders, two now stand out: Spain’s Santander, which already owns the most resilient and best run bank in Portugal, Santander Totta; and China’s Fosun, a financial conglomerate that recently bought a foothold in the country’s insurance market.