LISBON, March 11 Portugal's largest bank, the
state-owned Caixa Geral de Depositos, plans to slash its foreign
assets by half by 2020 as part of an ongoing restructuring and
will prioritise selling its Spanish and South African
businesses, the lender said.
In a statement issued late on Friday, the bank, which posted
a record 2016 loss of 1.86 billion euros, said it expects to cut
its international assets to no more than 12 billion euros by
2020 from 23 billion last year, while targeting a rise in return
on equity from the operations to more than 15 percent from 13
CGD's total net assets at the end of last year stood at 93.5
billion euros, down from some 101 billion in 2015.
The lender said it planned to maintain operations "in
markets with Portuguese affinity", which include
Portuguese-speaking Angola, Mozambique and the Macau region in
China, while selling or shutting down the remaining non-core
"We will give priority to operations (to sell) in South
Africa and Spain," CEO Paulo Macedo told reporters, adding that
the bank's French unit was also likely to be sold.
Banco Caixa Geral in Spain has 110 branches across the
country and employs about 500 people. CGD's Mercantile Bank has
a network of branches mainly in the Johannesburg region.
Most of CGD's businesses abroad made a positive contribution
to last year's results, if smaller than in 2015, led by its
Macau subsidiary, the French unit, which serves thousands of
Portuguese emigrants, and Angola.
Burdened by massive bad loans, which now have largely been
provisioned for leading to last year's huge loss, CGD is being
recapitalised to the tune of 4 billion euros.
The European Commission on Friday cleared the
recapitalisation as it was carried out on market terms and
therefore involved no new state aid. It said the plan presented
by Portugal to ensure the bank's profitability meant the state
would receive a market-based return on its investment.
(Reporting by Andrei Khalip; Editing by Helen Popper)