BPI reaffirms dividend cushion stocks

Bank BPI said that despite an additional reserve for the real estate market crisis, it still has sufficient margin to pay dividends. The bank said the additional provision, which was put in place by Banco de Portugal to protect banks from losses related to a possible decline in house prices, would reduce its capital ratios by 78 basis points, but it is confident it will be able to pay dividends. "This sectoral systemic reserve measure leads to an estimated September 2023 increase of 78 basis points in its own capital requirements," the bank, led by João Pedro Oliveira e Costa, said in a letter sent to the market. In addition he adds: "BPI currently significantly exceeds the minimum capital requirements and, following the introduction of this measure, has an MDA buffer - a capital buffer with no restrictions on outcome distributions - of 470 basis points by September 2023, according to the database cited."

This is the introduction of a capital reserve for systemic risk in the residential real estate market.

This reserve will amount to 4% of the amount of the risky portfolio of credit positions with collateral in the form of real estate intended for housing in Portugal. This requirement must be met by Core Tier 1 (CET1) own funds as of October 1, 2024.

BPI made a profit of €390 million in the first nine months of the year, up 35% year-on-year. The bank's CEO, João Pedro Oliveira e Costa, has already announced that he plans to pay a dividend to shareholder CaixaBank Spain. "I realize that the situations we are experiencing right now are of some concern and we must take all warnings seriously. (...) We will pay a dividend to the shareholder in accordance with the rules set by the regulator," he said two weeks ago at the Money Conference organized by TSF and DN.