Venezuela's Banesco buys failed Spanish bank
One of Spain's failed banks, Galicia's NCG Banco has been purchased for €1 billion ($1.34 billion) — by Venezuelan bank Banesco.
Venezuela's Banesco bank will buy 88.33 percent of nationalized Spanish bank NCG Banco for €1 billion ($1.34 billion), Spain's bank restructuring fund FROB said on Wednesday.
Banesco's offer beat five rival bids in the privatization tender for the lender based in the northwestern region of Galicia, the fund said in a statement.
Under the deal Banesco, controlled by billionaire Juan Carlos Escotet, will buy two portfolios of written-off loans.
Banesco will pay 40 percent of the price when the sale closes and the rest in stages through 2018.
Its offer met the condition of exceeding the next best offer by €200 million and 50 percent to prevent the tender going into a second phase, the restructuring fund said.
NCG Banco is one of three banks still controlled by the Spanish state following a European bailout of the country's financial system last year.
It received €9.1 billion from a €100-billion credit line offered by the eurozone in July 2012 to Spain banks, which have been swamped with bad loans following the collapse of a property bubble in 2008.
Spain has drawn a total of €41.3 billion from the credit line, which expires at the end of January.
International creditors who rescued Spain's tottering banks said Monday the sector was on the way to recovery but warned Madrid to be vigilant as the bailout winds up.
"The process of restructuring of banks having received state aid is well underway," the European Commission said in a statement, following its latest visit along with the International Monetary Fund to assess Spain's progress.
NCG Banco has €57 billion of assets and 672 branches. It earned €61 million during the first nine months of 2013 after posting a loss in the previous year.
Banesco beat out offers from Spain's Santander, BBVA and CaixaBank, as well as from US investment funds Guggenheim and JC Flower, which posted a joint bid with the Oaktree fund.
Bidders had until December 13 to present offers for NCG Banco.
Banesco has arms in Panama, the Dominican Republic, Puerto Rico, Colombia, and the United States.
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Venezuela's Banesco bank will buy 88.33 percent of nationalized Spanish bank NCG Banco for €1 billion ($1.34 billion), Spain's bank restructuring fund FROB said on Wednesday.
Banesco's offer beat five rival bids in the privatization tender for the lender based in the northwestern region of Galicia, the fund said in a statement.
Under the deal Banesco, controlled by billionaire Juan Carlos Escotet, will buy two portfolios of written-off loans.
Banesco will pay 40 percent of the price when the sale closes and the rest in stages through 2018.
Its offer met the condition of exceeding the next best offer by €200 million and 50 percent to prevent the tender going into a second phase, the restructuring fund said.
NCG Banco is one of three banks still controlled by the Spanish state following a European bailout of the country's financial system last year.
It received €9.1 billion from a €100-billion credit line offered by the eurozone in July 2012 to Spain banks, which have been swamped with bad loans following the collapse of a property bubble in 2008.
Spain has drawn a total of €41.3 billion from the credit line, which expires at the end of January.
International creditors who rescued Spain's tottering banks said Monday the sector was on the way to recovery but warned Madrid to be vigilant as the bailout winds up.
"The process of restructuring of banks having received state aid is well underway," the European Commission said in a statement, following its latest visit along with the International Monetary Fund to assess Spain's progress.
NCG Banco has €57 billion of assets and 672 branches. It earned €61 million during the first nine months of 2013 after posting a loss in the previous year.
Banesco beat out offers from Spain's Santander, BBVA and CaixaBank, as well as from US investment funds Guggenheim and JC Flower, which posted a joint bid with the Oaktree fund.
Bidders had until December 13 to present offers for NCG Banco.
Banesco has arms in Panama, the Dominican Republic, Puerto Rico, Colombia, and the United States.
Don't miss stories about Spain, join us on Facebook and Twitter.
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