BES sells private bank as shareholder placed under management

22nd July 2014, Comments 0 comments

The main shareholder of troubled Banco Espirito Santo (BES) was placed in receivership on Tuesday as Portugal's largest listed lender announced it has sold off the bulk of its Swiss-based private bank.

Luxembourg's district court in a statement said it had agreed to a Friday request from Espirito Santo International (ESI) that it be placed under "controlled management".

Portugal has been thrown into turmoil since allegations emerged of accounting irregularities in ESI, owned by the high-profile Espirito Santo family, cast doubt on the strength of its economy.

Lisbon has admitted the crisis engulfing the giant Banco Espirito Santo group could affect Portugal's recovery after the country emerged from an international bailout in May.

President Anibal Cavaco Silva said the problems affecting the group "could have a certain affect on the real economy... and its creditors could be confronted with serious difficulties".

Portuguese authorities have also said they had opened several investigations into possible criminal offences related to BES and its entities.

BES' Swiss-based private banking arm Banque Privee Espirito Santo (BPES) and Compagnie Bancaire Helvetique (CBH) meanwhile said they had agreed the sale of the former's client portfolio from Portugal, Spain and Latin America.

The two banks did not reveal details of the price tag or how many clients would come under CBH's wing.

BPES chief Jose Manuel Espirito Santo said the deal with CBH offered an "excellent solution" and that it was the best means to "defend the interests of our customers and staff".

Philippe Cordonier, head of CBH, said the deal marked a "significant step in the development of our bank" thanks to the expansion of its geographical reach.

CBH is a relatively low-profile player in the Swiss private banking sector, which caters for ultra-wealthy clients from around the globe drawn by the Alpine country's tradition of discretion.

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© 2014 AFP

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