Police searches overshadow Novobanco sale ceremony

Portuguese judicial police officers swooped on Novobanco headquarters while the actual contract signing ceremony was being held at the Ministry of Finances on Wednesday celebrating the bank’s sale to the French banking group BPCE.

The highly embarrassing moment for Novobanco’s top brass was reminiscent of the police searches at its predecessor Banco Espírito Santo over decade ago in the lead up to that bank’s collapse.

In a re-run of the bad old times, the CEO of the bank, Mark Bourke was reported to have rushed out of the building to avoid journalists’ questions about the searches going on at the bank’s HQ in Tagus Park.

The signing ceremony took place today (Wednesday, October 29) in the central hall of the Ministry of Fiances in Lisbon and was marked by speeches from Nicolas Namias  President of the French bank, João Filipe Freitas, the President of the Resolution Fund, and the Minister of Finances, Joaquim Miranda Sarmento, the latter being the last to speak.

As soon as Miranda Sarmento  finished his speech and during the greetings phase, the executive president of Novobanco stood up and left quickly after receiving what looked like a text message, followed by the other participants. No questions from journalists were planned during the ceremony, but none of the participants spoke to journalists afterwards.

Operation haircut

The judicial searches in the operation called “haircut” refer to the sale of assets during the Lone Star period of management, marked by several transactions of bad credit (NPLs) and real estate below the value of the balance sheet of Novobanco, hence the designation of haircut (discount).

The statement from the Public Prosecutor’s Office refers to “facts that may constitute the practice of crimes of active and passive corruption in the private sector, qualified fraud and money laundering, in the context of the sale of Novobanco’s assets since 2018”.

The legal entity also involved in the investigation refers to real estate transactions that generated “substantial losses”.

The losses from these transactions granted the right to financial cash injections into Novo Banco from the Resolution Fund on the back of the Contingent Capital Mechanism.

These losses and the injections from the fund totalled €3.4Bn and were one of the central issues for the parliamentary enquiry into Novobanco that was held in 2021 at the time in which the institution was led by António Ramalho who left in 2022.

In August of that year, Mark Bourke was chosen by Lone Star as the new CEO of Novobanco, but had already been the financial director of the bank since 2019.

With the signing of the sale agreement, Novobanco is now totally in the hands of BPCE, the fourth largest banking group in the EU, which now holds the positions held by Lone Star (75%), the State, and the Resolution Fund in a deal worth €6.4Bn – considered the banking sector sale of the decade in Europe.

Portugal’s Minister of Finances,, Joaquim Miranda Sarmento (C), the Executive President of BPCE, Nicolas Namias (D), and Kambiz Nourbakhsh (E) da Nani/Lone Star during the sale contract signing ceremony of Novobanco, in Lisbon, October 29, 2025. RODRIGO ANTUNES/LUSA
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