U.S. private equity fund Lone Star and Portuguese authorities are set to share 1.3 billion euros ($1.34 billion) when Novo Banco makes its first dividend payout in the coming months.
Novo Banco was created in 2014, carved out of the collapsed Portuguese bank BES after a multi-billion-euro state bailout.
Since 2017 Novo Banco has been 75% owned by U.S. private equity Lone Star, with the Portuguese banking resolution fund and the state owning the remaining 25% stake.
In light of the bank’s performance and its built excess capital after a protracted embargo on dividend payouts, Finance Minister Joaquim Miranda Sarmento stated on Wednesday that “Novo Banco approached the European Central Bank for approval to release that amount of dividends” to shareholders.
In order to prepare for a possible IPO this year, the three owners decided last month to suspend the bank’s moratorium on dividend payments, which had been in place from 2017 until December 2025.
It has grown overcapitalized, with a core Tier-1 fully loaded capital ratio of 20.7%, more than double the minimum allowed of 9.3%.
“The resolution fund and the Treasury should receive around 300 million euros in dividends to the state as a whole in April or May, which is still a small part of what taxpayers deposited in the bank,” the minister stated.
Under pressure from impairments still connected to assets inherited from BES, Novo Banco lost 1.3 billion euros ($1.37 billion) in 2020. However, it earned a profit in the next three years.
It made a consolidated net profit of 610 million euros in the first nine months of 2024.
($1 = 0.9677 euros)
