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BMN cuts back its real estate risk by 5,860 properties
11 Jul 2011
BMN has cut back its real estate risk by 10% over the first half of this year by subrogating, cancelling or selling 5,860 properties from its portfolio, enabling it to stay on track with the forecast of a 23% reduction in risk by the end of the year.
Moreover, during the same period the institution has completed 64% of the total restructuring of the commercial network envisaged for the middle of 2012, wholesale financing has been reduced by 1,100 million Euros and retail deposits have increased on a year-to-year basis by 500 million, that is to say 1.5%.
The profit forecast stands at around 100 million Euros
The data for the first semester were presented at the board of directors on 5th July and demonstrate the group’s evolution, which has been described by its chairman, Carlos Egea, as “extremely satisfactory”. The profit forecast for BMN stands at around 100 Million Euros.
Since BMN was established in December of last year, and until 30th June, 180 branches of the 280 earmarked for closure by mid-2012 have shut their doors. This means that in just six months 64% of the total of the restructuring plan has been completed. Along the same lines, the workforce has been reduced by 745 employees, through early retirement deals and negotiated redundancies. The synergies process that is giving rise to this restructuring is now beginning to show on the results account, and will make for a reduction in costs of around 21% upon completion, and for estimated annual savings of 170 Million Euros.
The integration process of branches in the natural areas of each of the four savings banks BMN is comprised of has finished, with the brand of the entity in each autonomous community being maintained in the region in question. Furthermore, in Madrid the redesigning of the 45 existing branches has commenced, with the introduction of the BMN brand.
Image of the inside of one of BMN’s branches in Madrid
The financial integration of the four savings banks in BMN will culminate on 31st August
The financial integration of BMN will culminate on 31st August, when the total segregation of the assets and liabilities of the four savings banks in favour of the bank is due to take place. The boards of directors of all four institutions had already approved the transfer of their assets and liabilities to BMN last March, and these agreements were subsequently ratified by the respective general assemblies on 30th May.
At present BMN is making progress in the recapitalization plan approved by the Bank of Spain, and is continuing to negotiate the entry of private investors. The BMN group was the first commercial bank formed by savings banks to be presented before analysts on 12th January, and during this act it gave details of its main aggregates.
BMN also proceeded to launch the first offer of converged products a few weeks ago, and just a few days later over 10,000 applications for subscription to its “2011 salary campaign” had been received. Customers will receive a LED television with DTT and high definition for having their salary or pension paid directly into their account. And the bank has also launched a welcome campaign for its customers, offering them the chance to make a deposit with a profitability of 3% APR for twelve months.
BMN is one of Spain’s most important financial groups with 70,000 million in assets and 3.6 million customers, a leader in the Mediterranean Arc, and it also has an appropriate presence in Madrid. As a result, its area of action groups together over two thirds of the population of Spain and the country’s GNP.