BPI Said to Mull Sale of Angolan Unit After CaixaBank BidManuel Baigorri and Ruth David
Banco BPI SA is considering the sale of its Angolan unit to boost capital and lower risks, after the Portuguese lender received an offer from Spain’s CaixaBank SA, people with knowledge of the matter said.
A sale of the Angolan business would help BPI strengthen its capital buffers amid increasing pressure on the industry from the European Central Bank, the people said, asking not to be identified because the deliberations are private. A deal isn’t imminent and no final decision has been made, they said.
CaixaBank, which last week offered to acquire the stake in BPI it doesn’t already own, doesn’t intend to keep the Angolan business, one of the people said. Isabel dos Santos, the daughter of Angola’s President and Africa’s richest woman, who already controls almost 19 percent of BPI through a holding company, may be a potential buyer for the business, they said.
Representatives for BPI and CaixaBank declined to comment. A spokesman for dos Santos wasn’t immediately available to comment. BPI is working on “several solutions” with the ECB on limiting its exposure to Angola, Chief Executive Officer Fernando Ulrich said at a press conference in Lisbon last month, declining to provide further details.
BPI shares were trading 1.5 percent lower in Lisbon at 15:00 p.m. Caixabank rose as much as 0.6 percent in Madrid, reversing earlier losses and outperforming the benchmark IBEX 35 Index, which fell slightly.
BPI in January posted a net loss of 161.6 million euros ($181 million) for 2014, compared with net income of 66.8 million euros a year ago. The Angolan unit -- Banco de Fomento Angola -- in which BPI holds a 50.1 percent stake, contributed 117 million euros last year. The remaining 49.9 percent stake in BFA is owned by Unitel SA, Angola’s largest mobile-phone carrier, in which dos Santos is a shareholder.
The entire bank’s fully-loaded common equity tier 1 ratio, under the E.U.’s most recent Capital Requirements Directive, was 8.6 percent.
CaixaBank, which controls 44 percent of BPI, has offered as much as 1.1 billion euros -- or 1.329 euros in cash per share -- to buy out investors, in a bid to become the largest lender in the Iberian region.
CaixaBank agreed to buy Barclays Plc’s banking operations in Spain last September, and is seeking to expand in Portugal as BPI prepares to bid for rival Novo Banco SA. The BPI purchase will provide annual cost savings of about 130 million euros by 2017, CaixaBank said, adding that it may have to raise capital if the offer is accepted.