Banco Privado Atlantico SA and Banco Millennium Angola SA, Angola’s fifth- and sixth-biggest lenders, agreed to merge as the oil producing country’s economy struggles to cope with falling crude prices.
The merger will create Angola’s second-biggest privately-held lender, according to a regulatory filing from Portuguese lender Banco Comercial Portugues SA, which owns 50.1 percent of Banco Millennium Angola. The Angolan unit expects a return on capital invested of about 20 percent with the merger, helping to compensate for the slowdown in Africa’s third-largest economy.
Banco Comercial Portugues will hold about 20 percent of the new entity and the merger will have a positive impact of 37 basis points on the bank’s Common Equity Tier 1 phasing-in ratio, according to the filing. The merged bank will have 9 percent market share in total deposits and an 11 percent shares of the lending market.