Novo Banco to reach its NPL’s target by the end of the year, says CEO

Novo Banco (NB) should reach its 5% target for non-performing loans (NPL) “this year in a very short space of time”, the financial institution’s CEO believes.

Interviewed on Bloomberg TV, Mark Bourke said that once this goal is met, the second phase will involve reducing the bad debt ratio between 3% and 4%, a figure that will be achieved in two to three years through a “combination of restructuring and sales”.

The development has happened despite the war in Ukraine and rising rates. “If we look at the situation in historical terms, we are still normalising,” the CEO said. And at least for now this normalisation has not yet brought a significant increase in NPL. In Novo Banco and the Portuguese economy “we don’t see a significant rise in NPL formation”, he said. “And this would be a shared experience among banks.”

Asked whether he is aware of contacts by shareholder Lone Star with potential buyers of the bank, Mark Bourke replied with a peremptory “no, absolutely not”, adding however that “shareholders talk to lots of people”. But management’s role is to “prepare the bank and have it in good shape”.

Original Story: Jornal de Negócios |Hugo Neutel
Photo: Novo Banco
 Edition and translation: Prime Yield