Angola’s BPC sells US$1.385 million in unpaid loans

11 July 2017

Angolan state bank Banco de Poupança e Crédito (BPC) intends to sell bad loans in the amount of 231 billion kwanzas (US$1.385 billion) to public limited company Recredit as part of the bank’s financial recovery plan, the chairman of the board said.

Under the terms of the plan, BPC will increase its capital through subscription of ordinary shares by shareholders in the amount of 90 billion kwanzas (US$540 million), as well as issuing convertible subordinated debt instruments eligible for equity worth US$72 billion (US$432 million), Ricardo Viegas de Abreu also said.

The chairman, who spoke at a press conference on the first 100 days of this board, said the BPC capitalisation plan was a set of initiatives intended to maintain a sound financial position and a sustainable level of profitability that is appropriate for the bank’s risk profile.

Quoted by Angolan news agency Angop, Viegas de Abreu noted that the recovery of bad loans depends largely on economic growth, “given that most of the creditors have lost their financial capacity due to the cyclical situation that the country is experiencing.”

The stabilisation, restructuring, dynamisation and control of BPC’s business is expected to be completed in 2018, the chairman of BPC said.

BPC is owned by the Angolan state, with 75%, the National Social Security Institute (15%) and the Social Security Fund of the Armed Forces, with the remaining 10%.

The BPC ended 2016 with a loss of 29.5 billion kwanzas (US$177 million), due to provisions needed to cover impairments resulting from doubtful loans.

Recredit, which is wholly owned by the Angolan state, with the powers and obligations of the State exercised by the Ministry of Finance, was conceived as part of the recovery of Banco de Poupança e Crédito and its scope was extended by presidential decree last December to the whole of the Angolan banking sector. (macauhub)