Novobanco to sell luxury resort in Cape Verde

Novobanco has put up for sale a number of properties and parcels of land that comprise the luxury resort Vila Verde Resort on the Ilha do Sal in Cape Verde at a value of €90 million, according to the online site ECO.

The assets are part of the development that was developed in the town of Santa Maria by Tecnisil. The developer started the project in 2006 but it stalled because of various financial crises between 2007 and 2011, leaving the works unfinished and a debt of around €93 million to Banco Espírito Santo which collapsed in 2014.

The assets and non-Performing Loans associated with Tecnisil were inherited by Novobanco when the Bank of Portugal decided to windup the bank run by Ricardo Salgado in August 2014.

This is not the first time that Novobanco has tried to offload the resort. In 2019, it was included in a portfolio of NPLs called Nata II (Sold to the fund Davidson Kempner), but was removed because of the lack of interest from buyers in the asset.

Three years ago the Tecnisil portfolio again went on the market, but this time its components were to be sold on an individual basis. However, this too was unsuccessful.

Now in the hands of Lone Star – which has recently announced the sale of Novobanco to the Groupe BPCE for €6.4Bn – Novobanco is trying to speed up the selloff of problematic assets inherited from BES.

Between 2016 and 2024 the bank’s ratio of NPLs fell from 33.6% to just 4.1% reflecting the efforts to clean the bank’s balance sheet through the contingent capitalisation mechanism created in 2017 with a cash stash of €3.89Bn, designed to cover losses related to NPLs and other losses from BES.

The resort is currently being managed by another Portuguese hotel group, Agua Hotels, that took over the operation of the resort in 2015 after Tecnisil advanced with a ‘sanitation’ plan to clean up the problem of the high bank debt.