* "Extraordinary" measures because of "deteriorated"
* Provisional administrators named to overhaul BESA
* Follows Portugal's 4.9 bln euro rescue for parent BES
* Recent surge in Angola bad loans due to economy slowdown
(Adds quotes, details on BESA's loans, deposits)
By Pascal Fletcher
JOHANNESBURG, Aug 4 Angola appointed
administrators to manage the indebted local unit of Portugal's
troubled lender Banco Espirito Santo on Monday and said
a sovereign guarantee for most of its loans would be revoked.
Announcing "extraordinary overhaul measures", the central
bank of Africa's second biggest oil producer, stopped short of
nationalising Banco Espirito Santo Angola (BESA), one of the
country's biggest lenders.
Citing the "deterioration" of BESA's credit portfolio, which
it said had affected the bank's liquidity and solvency, the
central bank said the new administrators would work with the
bank's existing board, which would maintain day-to-day
The measures closely followed Portugal's announcement of a
4.9 billion euros ($6.58 billion) rescue plan for BESA's
Banco Espirito Santo is to be split into a "good bank",
renamed Novo Banco, and a "bad bank", which will house BES's
exposures to the troubled Espirito Santo business empire as well
as its Angolan subsidiary.
In its statement Banco Nacional de Angola, which did not
name the provisional administrators appointed to run BESA, said
a sovereign guarantee extended by Angola in December, of up to
$5.7 billion, to cover most of BESA's loan book, would be
revoked "in the initial phase of implementation".
"The overhaul measures aim to restore the financial and
operational sustainability of the bank, bringing them into line
with existing norms for banking activity in the country, but
without contemplating, for the moment, the State's intervention
in the social capital of the bank or the involvement of public
funds," the central bank said.
"The existing board remains in office," it added, saying
they would work with the administrators.
BESA's assets would be assessed and could be sold off or
restructured, the Angolan central bank said, adding that
deposits at the bank would be guaranteed, and its business
relations with existing clients would remain unchanged.
The crisis affecting BES, Portugal's largest listed bank,
had highlighted its exposure in the former colony of Angola,
where BESA is a major financial player, with links to the ruling
SURGE IN BAD LOANS
Many banks in Angola have been hit by a surge in bad loans
in recent years due to an economic slowdown. The IMF sees
Angola's real GDP growth slowing this year to 3.9 percent from
4.1 percent in 2013 and 5.2 percent in 2012.
BESA's total loans rose to 672 billion kwanzas ($6.9
billion) in 2012 from 350 billion two years earlier, according
to a survey published last year by international accountancy
firm KPMG, while deposits grew over the same period at a much
slower pace, from 266 billion kwanzas to 349 billion, valuing
its loan book at nearly twice its total deposits.
Angola broke its silence on the BES affair last month, when
the central bank's governor Jose de Lima Massano admitted to
parliament there were problems with BESA's credit portfolio that
included bad loans and said BESA would need more capital.
In its statement on Monday, the central bank said it was
announcing the overhaul measures for BESA because it had not to
date received "unequivocal answers from the BESA shareholders
about the possibility or terms of a capital increase".
The Angolan statement made no reference to the rescue plan
for BES announced by Portugal late on Sunday, but Portuguese and
Angolan officials have been discussing the crisis at the bank.
($1=97.8 Angolan kwanzas)
(Additional reporting by Xola Potelwa and Ed Crople; Editing by
Joe Brock and Greg Mahlich)