Espirito Santo Falls Most in a Month as Net Drops: Lisbon Mover

Banco Espirito Santo SA (BES), Portugal’s biggest publicly traded bank, fell the most in a month in Lisbon trading after reporting lower quarterly profit.

The stock dropped as much as 5 euro cents, or 8.6 percent, to 53 cents, the biggest intraday decline since April 12. Espirito Santo traded at 53.8 cents as of 2:11 p.m. in the Portuguese capital, which would be the lowest close since 1993.

Espirito Santo, which is based in Lisbon, said yesterday after the close of trading that first-quarter net income dropped 84 percent to 11.6 million euros ($15 million).

“These earnings consolidate the trend of accentuated deterioration of the quality of the bank’s assets, in line with the sector in Portugal, and with the level of provisioning remaining high,” Andre Rodrigues, an analyst at Caixa-Banco de Investimento SA, said today in a research note. Rodrigues has a buy recommendation on the stock.

Espirito Santo last week completed a 1 billion-euro capital increase. That share sale will increase the bank’s core Tier 1 ratio, a measure of financial strength, to 10.75 percent from 9.21 percent, the lender said on April 11.

To contact the reporter on this story: Joao Lima in Lisbon at jlima1@bloomberg.net

To contact the editor responsible for this story: Tim Quinson at tquinson@bloomberg.net

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