Montepio and Crédito Agrícola should merge

 In News

The banks Montepio and Crédito Agrícola are likely to merge in the future according to the President of the Associação Mutualista Montepio, Tomás Correia.

Addressing the International Club of Portugal on Friday, he said that the two banks should merge to form a large retail bank.

“The two social economic institutions (cooperative banks) operating in the financial sector have all the right conditions to merge and become one large retail bank in Portugal” he said.

When quizzed on the fact that the president of Crédit Agrícola had already ruled out a merger, Tomás Correia downplayed the statement and said sooner of later it was likely to happen.”
He said that it was “in the country’s interest to have a strong social economic financial group in Portugal and should discuss the possibility.”Tomás Correia said that social economic institutions should be able to reorganise and develop a large retail bank in Portugal to compete and offset a banking sector which is dominated by foreign capital with the exception of Caixa Geral de Depósitos, Montepio and Crédito Agrícola.

This year Crédito Agrícola, which is led by Licínio Pina, saw profits surge 37% to €64 million in the first half thanks to increased revenues from lending and deposits. That compared to €46.9 million in 2017.

As for the insurance sector, with which Montepio has a strong link, Tomás Correia said the situation was “even worse” with national insurers in the hands of foreign entities.

“I am convinced that if we don’t change the situation — and it will be hard — we’re going to face a big problem and soon,” adding that the control of Portugal’s banking sector by foreign groups would “harm the chances of Portuguese companies getting finance and hiring young Portuguese talent who would be forced to go elsewhere.”