A failed and corruption-ridden bank BPN, which clocked up a €2.4 billion black hole, has been sold to a rival investment bank for just €40 million.
The decision by the Portuguese State to sell off the bank quickly was on the orders of the ‘troika’ commission.
The bank had been nationalised with €2.4 billion in losses – almost half of the money required by the government to reduce the public deficit from 9.1% to 5.9% of GDP.
Among the bank’s shareholders is the daughter of Angolan President José dos Santos, Isabel dos Santos, and Portugal’s richest man Américo Amorim.
“The Government has taken the decision to choose the Banco BIC offer with a view to negotiating, under conditions of exclusivity, an agreement to offload BPN’s capital shares,” stated the Ministry of Finances over the weekend.
In practice, it means that each person in Portugal – some 10.5 million inhabitants – will foot the bill for BPN’s debts, estimated at €228 per person.
The deal, which should be completed within six months, will force the State to recapitalise the bank with €550 million of public money.
“The Government has decided to select a proposal from a credit institution which is duly authorised to exercise its activities in Portugal to ensure the continuity of BPN’s activities taking into consideration the defence of depositor interests,” a Government statement said.
The President of BIC, Luis Mira Amaral, confirmed that he had met with the Secretary of State for the Treasury, Maria Luís Albuquerque, at the Ministry of Finance to discuss the deal but refused to enter into details about the proposed buyout.
