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UPDATE 1-Spain's Banco Popular CEO to step down
April 3, 2017 / 3:31 PM / 8 months ago

UPDATE 1-Spain's Banco Popular CEO to step down

(Adds details, background)

MADRID, April 3 (Reuters) - Banco Popular’s chief executive Pedro Larena is to step down, the Spanish bank said on Monday, marking the group’s third leadership shake-up since last July.

Banco Popular said in a statement that Larena would leave for strictly personal reasons and would continue in his role until the bank named a replacement.

Larena had joined Popular in September after the previous CEO Francisco Gomez was fired in July after shareholders rebelled over lack of progress in turning around the bank’s performance.

Popular has been trying to clean up its balance sheet which is weighed down with billions of euros of toxic real estate assets.

Earlier on Monday, Popular said an internal audit had found the need for adjustments to the previous year’s accounts. These would be included in its results for the first half of 2017.

Popular said the adjustments would not affect its financial statements in a “significant way” and they would have a small impact on its 2016 accounts but they would affect its capital.

Popular’s shares fell sharply and were down 8 percent by 1500 GMT.

Popular has been the worst performer in the European STOXX Europe 600 banking sector index in the last six months and is down 60 percent over the past year.

Larena had been considering stepping down for weeks after he lost influence to Miguel Escrig, Telefonica’s former chief financial officer who was picked as the right hand man of the new chairman Emilio Saracho, Expansion newspaper reported on Monday, citing anonymous sources.

A Banco Popular spokesman declined to comment on the report.

Last December, Popular replaced former Chairman Angel Ron with Saracho as it tried to get the bank’s turnaround on track.

Popular posted a record 3.5-billion-euro ($3.74 billion) loss in 2016. Its non-performing property loan book also eroded its capital position and cast doubt over its financial targets.

Larena previously was Deutsche Bank’s head of international retail banking.

$1 = 0.9368 euros Reporting By Jesús Aguado; Editing by Angus Berwick and Jane Merriman

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