LISBON Jan 8 Portugal's Banco Espirito Santo
is confident it can cut dependency on European Central
Bank support after a successful 500 million euro ($653.30
million) bond issue on Tuesday, the bank's Chief Financial
Officer (CFO) said.
Portuguese banks are fighting to return to the bond markets
after being shut out by the euro zone debt crisis in 2010 and
have been forced to rely on the European Central Bank for funds.
CFO Amilcar Morais Pires said the five-year bond deal had
generated strong demand of 3 billion euros.
BES, the country's second-largest private bank by assets,
became the first Portuguese bank to return to the bond market in
two years when it sold a 750 million euro 3-year unsecured bond
in October. The CFO said the bank's return to the markets had
paved the way to reduce reliance on the ECB.
"We expect to progressively reduce our dependency on the
ECB," Morais Pires told Reuters. "We can't still say the
conditions in the bond market are normalised but we have
witnessed a progressive improvement," he said.
Amilcar Pires said BES had bolstered its capital ratios in
2012 using the capital markets to give the bank a strong
core-Tier 1 ratio - a measure of financial strength - of above
BES is the only Portuguese bank to reinforce its capital via
the equity market and not from the country's European Union/IMF
About 90 percent of the Tuesday's bond deal went to foreign
investors, including 38 percent to the United Kingdom, 8 percent
to Spain, 7.5 percent to Germany and 7 percent each to France
and Switzerland. The bond had a 4.75 percent coupon and a
re-offer yield of 4.90 percent.
BES shares closed up 1.95 percent on Tuesday, outperforming
the wider Lisbon index which was down 0.2 percent.
($1 = 0.7654 euros)
(Reporting by Sergio Goncalves, Writing by Daniel Alvarenga.
Editing by Jane Merriman)