French lender BPCE to buy Portugal's Novo Banco in major merger deal
The offer values the lender at €6.4bn, making the deal one of Europe's largest banking transactions in recent years. It also reflects a recent wave of consolidation interest within the sector.
The transaction is expected to close in the first half of 2026, subject to the necessary approvals from regulators and shareholders.
'This transaction enhances our ability to serve Portuguese families and businesses, deepens our commitment to the national economy, and secures a long-term future built on strength, trust, and shared ambition,' said Novo Banco's CEO Mark Bourke in a regulatory filing.
Novo Banco was established in 2014 by the Portuguese central bank as the "good bank" carved out from the collapsed Banco Espírito Santo. BES was one of Portugal's oldest and most prominent lenders before its failure during the eurozone financial crisis.
In 2017, after over two years of failed attempts by the Portuguese government to privatize Novo Banco, Lone Star acquired a 75% stake by injecting €1bn in capital.
The remaining 25% remained under the control of the Portuguese resolution fund and the state, as is still the case today.
The years following the acquisition were complicated for Lone Star. Novo Banco dealt with hefty legacy losses from bad loans, which jeopardised the lender's financial position. But in 2021, the bank turned a corner by posting its first profits.
Since then, the lender has built itself up as a major player in the Portuguese financial scene. According to Novo Banco's first quarter earnings report, the lender held €43.72bn in net assets and posted a return on tangible equity of 21.7%.
BPCE has already initiated conversations with Portuguese authorities regarding the possible purchase of the remaining 25% stake, meaning the deal could eventually evolve into full ownership.
For now, however, the French bank is still diversifying its geographic footprint by entering a second core retail market in Europe.
It also increases its exposure to variable rate loans, which are more common in Portugal than in France.
A competing offer had been considered from Spain's CaixaBank, which already owns Portuguese lender BPI, but the Portuguese government had doubts about increasing Spanish influence in its domestic banking sector.
The deal between BPCE and Lone Star comes in the context of a broader trend of cross-border banking mergers.
After years of subdued merger activity following the 2008 financial crisis, institutions like UniCredit, BBVA, and Italy's MPS are actively pursuing expansion strategies.
At the same time, governments are gradually stepping back from previously nationalised banks, opening the door for more private ownership.
Examples of this include UniCredit's stake building in Germany's Commerzbank, with ownership now nearing 30%, and its partial ownership of Greece's Alpha Bank (20%), along with BNP Paribas' acquisition of AXA Investment Managers.
An ongoing merger saga is also unfolding in Spain, where the country's second-largest bank, BBVA, has launched a hostile public offer to acquire its rival Banco Sabadell.
Workers in Europe have been gradually putting in fewer hours. Over the past 10 years, the average time spent working per week has declined by one hour in the EU. In nearly half of 34 European countries, the drop was even greater — more than one hour between 2014 and 2024. Weekly working hours also vary significantly across the continent.
So, in which European countries do people spend the most time at the grindstone? How has actual working time changed across the region? And what could be the possible reasons behind this decline?
According to Eurostat, in 2024, the actual weekly working hours for both full-time and part-time workers aged 20 to 64 in their main job ranged from 32.1 hours in the Netherlands to 39.8 hours in Greece. When including EU candidate countries, EFTA members, and the UK, the highest figure was recorded in Turkey (43.1), where average weekly working time exceeded 43 hours.
People in Southern and Eastern European countries tend to work longer hours, with particularly high figures in EU candidate countries. Following Turkey, which tops the list at 43.1 hours, are Serbia (41.3) and Bosnia and Herzegovina (41.1). Montenegro hasn't reported data for 2024, although its working hours came to 42.8 in 2020.
The next countries in the ranking also belong to the same region: Greece (39.8) and Bulgaria (39). North Macedonia, which only has data spanning up to 2020, also recorded a weekly working total of 39 hours.
These countries generally have lower wages, higher informal employment, and less part-time work.
Western and Northern European countries generally have shorter work weeks. Countries like the Netherlands (32.1), Norway (33.7), and Austria and Denmark (33.9) all report significantly fewer weekly working hours. These regions are characterized by strong labour protections, higher productivity, and widespread use of part-time and flexible work arrangements.
Among Europe's largest economies, the UK and Spain (both at 36.4 hours) and Italy (36.1) report the highest average working times, all above the EU average. However, the UK data dates back to 2019, so the actual figure may be lower today, given the overall downward trend in working hours.
When comparing weekly working hours in 2014 and 2024, only four out of 34 countries saw an increase. In three of these countries, the rise was minimal: Lithuania and Cyprus (both by 12 minutes), and Malta (6 minutes). Serbia was the exception, with a significant increase of 1.7 hours — 1 hour 42 minutes.
Weekly working time remained unchanged in France, while the decrease was less than half an hour in Italy, Sweden, and Latvia.
In 16 out of 34 countries, weekly working time fell by more than one hour — exceeding two hours in some cases.
Iceland (3.5 hours) closely followed Turkey (3.8 hours) at the top. Belgium and Luxembourg also recorded significant declines, with a reduction of 2.5 hours each in weekly working time.
In a further seven countries, weekly working hours declined by 1.5 hours or more. These include Denmark and Austria (both 1.9), Germany (1.8), Estonia (1.7), Czechia (1.6), and Portugal and Croatia (1.5).
Scholars and experts have been examining the reasons behind the decline in weekly working hours, offering various explanations. A recent working paper published by the European Commission analysed work time trends in six EU countries between 1992 and 2022. Sergio Torrejón Pérez and his colleagues found that:
Decline in working time is primarily linked to the growing prevalence of non-standard forms of work, mainly part-time work.
Part-time jobs have grown mostly because more women are working and because more jobs are in service industries.
Full-time workers are working more or less the same amount of hours as in the 1980s.
Self-employed people are working fewer hours over time because more of them are working part-time. Even so, they are still working the longest hours on average.
A paper published by the European Central Bank analysed working time in the euro area from 1995 to 2020. Vasco Botelho and his colleagues emphasised that the decline in hours contributed per worker is a long-term trend.
One reason is that technological progress over the past 150 years has transformed the nature of work.
They found that other key factors include the rising share of part-time employment, and the increase in female labour force participation, which is also closely linked to the growth of part-time work.
The decline in working time is driven by both demand and supply-side factors, according to the ECB report. Most part-time workers choose this arrangement voluntarily, opting to work fewer hours than full-time employees. In the overall sample, about 10% of workers reported that they would prefer to work more hours than they currently do.
Another working paper from the IMF by Diva Astinova and her colleagues also found that declines in actual working hours match declines in desired working hours in Europe.
'Increased income and wealth is likely to be the main force behind the decline in desired and actual hours worked,' they suggested.
In other words, researchers proposed that people feel less of a financial pull to put in more hours.
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