Groupe BPCE, France’s second-largest banking group and the fourth-largest in Europe, has entered into a Memorandum of Understanding to acquire a 75% equity interest in novobanco from private equity firm Lone Star Funds.
The transaction, which values novobanco at approximately €6.4bn for 100% of its share capital, represents a valuation multiple of around 9x annual earnings and stands as the largest cross-border banking acquisition in the eurozone in over a decade.
The deal marks a major milestone in BPCE’s “Vision 2030” strategy, aimed at accelerating growth and international diversification. Upon completion, Portugal is set to become BPCE’s second-largest domestic retail market.
Novobanco, Portugal’s fourth-largest bank, serves approximately 1.7 million retail clients and maintains a €17bn corporate loan book. With a network of around 290 branches and 4,200 employees, the bank has established strong positions in both retail and corporate banking, with market shares of roughly 9% and 14%, respectively.
Notably, novobanco has emerged as one of Europe’s most profitable banks, reporting a return on tangible equity (RoTE) above 20% and a cost-income ratio below 35%.
The acquisition underscores BPCE’s long-standing commitment to Portugal, where it already employs over 3,000 people and operates a multi-business expertise hub in Porto. The integration of novobanco will expand BPCE’s footprint and support the development of new financing solutions for individuals and businesses in Portugal.
Strategically, the deal enhances BPCE’s geographic diversification and strengthens its balance sheet through increased exposure to variable-rate assets. It is aligned with the group’s broader European expansion ambitions, following the recent launch of BPCE Equipment Solutions and its strategic asset management partnership with Generali.
BPCE is also in discussions with the Portuguese government and the Portuguese Banking Resolution Fund to acquire their remaining stakes in novobanco (11.5% and 13.5%, respectively) under the same terms.
Pending regulatory approvals and consultations with employee representative bodies, the transaction is expected to close in the first half of 2026. Post-acquisition, BPCE’s CET1 ratio is projected to remain above 15%, reflecting the group’s continued financial strength.
