Former CEO of bailed out Spanish bank becomes new CEO of Kuwait’s Gulf Bank
- Published on Wednesday, 19 March 2014 07:51
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Fomer CEO of Novagalicia, César González (left) and president, José María Castellano (right) Source: La VanguardiaKuwait’s Gulf Bank announced that is has hired Cesar Gonzalez-Bueno to be its new CEO. Mr. Gonzalez was the former CEO of bailed out Spanish bank, Novagalicia Banco. Gulf Bank was also bailed out back in 2009 after derivative losses stemming from the financial crisis.
Kuwait’s Gulf Bank said on Tuesday it had appointed Cesar Gonzalez-Bueno as chief executive, replacing Michel Accad who resigned in October last year.
The appointment of Gonzalez-Bueno, former CEO of Spain’s Novagalicia Banco, was effective as of March 16, the bank said in a statement.
Gonzalez-Bueno, a Spaniard who also previously worked as regional head at Dutch financial services group ING, as well as for management consultancy McKinsey, “will add new energy and dynamism to the bank’s growth,” Gulf Bank said.
Read the full story from Reuters.
The Spanish government injected €9.1 billion into Novagalicia Banco in 2011, which was part of a broader €100 bailout package agreed to by the EU to help Spanish banks. The bank was recently sold off to Venezuela’s Banesco Group.
Banesco Group will acquire control of NCG Banco SA for 1 billion euros ($1.37 billion) as Spain lines up buyers for banks rescued under last year’s European-funded bailout.
Through its Spanish Banco Etcheverria unit, Banesco, controlled by billionaire Juan Carlos Escotet, will also buy two portfolios of written-off loans, Spain’s bank rescue fund said in an e-mailed statement yesterday. Etcheverria said in its own statement that its bid didn’t include any request for state aid.
The sale of 88.3 percent of NCG Banco to Banesco is a step forward for Spain as it seeks buyers for lenders nationalized under the 41 billion-euro bailout that prevented mounting losses at savings banks from overwhelming government finances. NCG Banco has 57 billion euros of assets and 672 branches, and was formed from a merger of savings banks in the region of Galicia. It needed 9.1 billion euros of aid to replenish its capital.
Read the full story from Bloomberg.
Gulf Bank has some history with seeking government assistance when it gets into trouble. Most recently, it was bailed out in 2009 by Kuwait’s sovereign wealth fund, the KIA.
Kuwait’s Gulf Bank expects to post a profit in the first quarter after a bailout by shareholders to cover $1.29 billion (Dh4.73 billion) in derivatives losses, its chairman said on Saturday.
Trading in Gulf Bank, in which sovereign wealth fund Kuwait Investment Authority (KIA) owns a 16 per cent stake after a restructuring plan ordered by the central bank, could resume “within days”, Kutayba Al Ganem said.
“There will be profit in the first quarter,” Ganem said on the sidelines of a shareholders meeting. “Profit will be better than last year.” He did not elaborate.
In 2008, Kuwait’s fourth-largest bank by market value made a full-year net loss of 359.5 million dinars ($1.24 billion), compared with a net profit of 130.44 million dinars the previous year, citing losses on derivatives transactions.
Read the full story from Gulf News.We wish Mr. Gonzalez the best of luck at Gulf Bank and hope that his experience with bailouts can help him avoid any future bailouts at Gulf Bank.