Newspaper article International New York Times

Portugal Chooses New Chief for Bank

Newspaper article International New York Times

Portugal Chooses New Chief for Bank

Article excerpt

The Bank of Portugal has chosen Eduardo Stock da Cunha to take over as chief executive of Novo Banco from Vitor Bento, according to Portuguese media reports.

The Portuguese central bank was set to appoint a new chief executive late on Sunday to run the "good" bank created after the bailout of the Portuguese lender Banco Espirito Santo.

The central bank, the Bank of Portugal, has chosen Eduardo Stock da Cunha to take over as chief executive of Novo Banco from Vitor Bento, according to Portuguese media reports. A formal announcement was expected to be made by the central bank late on Sunday.

Mr. Bento and his two top lieutenants resigned abruptly on Saturday after only two months in charge, saying that their mandate had "significantly changed" since Mr. Bento was appointed to run Novo Banco's predecessor, Banco Espirito Santo.

Mr. Stock da Cunha is set to return to Lisbon from London, where he has been an executive at Lloyd's Banking Group. Lloyd's is headed by a former executive of Banco Santander, Antonio Horta Osorio. Mr. Stock da Cunha previously worked for Santander Totta, the Portuguese subsidiary of Santander, Spain's largest bank by assets.

The management reshuffle is another blow for Portuguese regulators, who have been struggling to engineer a rescue of Banco Espirito Santo after the bank was undone by its exposure to its struggling corporate parent. The assets of Banco Espirito Santo, one of Portugal's largest financial institutions, were transferred in August to Novo Banco as part of a bailout. The authorities plan to sell Novo Banco to private investors.

Banco Espirito Santo had been run for decades by the Espirito Santo family as part of a complex web of family-controlled companies. Regulators raised questions earlier this year about "irregularities" in its corporate parent's finances, but have still come under severe criticism for failing to intervene earlier and thereby prevent the bank from selling more debt to investors in the run-up to its collapse. Several businesses controlled by the family have also since sought creditor protection.

Mr. Bento and his colleagues were appointed to lead Banco Espirito Santo in July after Ricardo Espirito Santo Silva Salgado, the great-grandson of the founder of the family business, resigned as the bank's executive chairman. …

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