Portugal Reaches Agreement With EU on Caixa’s Capital Increase
- Country to inject 2.7 billion euros into state-owned bank
- Government plans to convert 960 million euros of CoCo bonds
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Portugal’s Finance Ministry said it got approval from the European Commission to inject as much as 2.7 billion euros ($3 billion) into state-owned Caixa Geral de Depositos SA, the country’s biggest bank by assets.
As part of the plan, the government will convert 960 million euros of contingent convertible bonds subscribed by the state into shares of the Lisbon-based lender to bolster capital buffers, the Finance Ministry said in a statement on Wednesday. Caixa Geral will also sell to private investors about 1 billion euros of debt instruments that are eligible to meet capital ratios.