Banco Montepio to post record results

Banco Montepio is preparing to announce historic results for 2022, although the bank lost market share in the mortgage market.

According to ECO online, the bank’s president, Pedro Leitão warned staff not to cross the home loans market share red line below 6% as it would leave the institution at the mercy of a market in which the authorities are putting intense pressure on banks to merge.
In a communiqué in which he took stock of 2022, Pedro Leitão refers to a distraction regarding loss of market share which needed to be corrected quickly, and for which all staff had to make a contribution — the bank has just resurrected a mortgage campaign which had been successful in the past and now offers the most competitive minimum spread in the sector of just 0.8% in order to beef up its market share against the competition in the Portuguese market – a market in which it has a 6.5% share.
In Portugal the market is dominated by five banks: Caixa, BCP, Santander, Novobanco and BPI which have a 70% market share.
Pedro Leitão said it was unacceptable that only one-third of the 239 branches had managed to increase their mortgage portfolios, and drew a red line which the bank must not cross: “In a mature market where scale in very important, market shares below 6% are red lines which we cannot ignore”, he said.
In other words, he was saying that if the bank could not generate sufficient business to retain the minimum market share required, it might be forced to merge/partner with another bank, or be subject to a hostile takeover bid.
In the first nine months of 2022 Banco Montepio had a profit of €23.9 million largely thanks to less allocations to cover impairments and provisions, despite the negative effect from the sale of Finibanco Angola.
Montepio is expected to close 2022 with the best results in a decade (over €24 million) — results which were only exceeded by the €45 million posted in 2011.