France-based BPCE has agreed to acquire Portugal-based Novo Banco in a USD 7.39 billion deal, with the arrangement including a 75% stake held by US private equity firm Lone Star.

The announcement was made on June 13, 2025, by BPCE and Lone Star, alongside the Portuguese state and a banking resolution fund financed by Portugal’s banks. These entities own 11.5% and 13.5% in Novo Banco respectively. This acquisition is part of an ongoing trend of cross-border and domestic banking mergers in Europe, driven by regulators aiming to integrate the financial sector and counter growing competition from US banking organizations.

Details of the Acquisition

BPCE’s representatives highlighted that this deal aligns with what the European Central Bank (ECB) is advocating, specifically for European banking consolidation. The acquisition will enable BPCE to expand into a second retail market outside France, where it currently operates two banking groups.

According to the Bank of France, this transaction is one of the largest cross-border deals in Europe recently, supporting both the banking union and the entire French banking system.

Additionally, BPCE already has a consumer credit operation in Portugal. Its subsidiary Natixis manages IT services and back-office operations for the group as well. Currently, Novo Banco operates over 300 bank branches with more than 4,200 employees.

Regarding the completion of the acquisition, BPCE stated that it should finalize during the first half of 2026.

BPCE’s Future Plans

To further advance its operations and presence across Europe, in June 2024, BPCE announced plans to collaborate with BNP Paribas. The joint venture aimed to acquire technology for processing payments for cardholders and merchants, enhancing the overall payments landscape. The two financial institutions noted that the processor was set to handle all card payments from both BNP Paribas and Groupe BPCE in Europe, which accounted for approximately 16 billion transactions.

Source: Reuters