MADRID - J.P. Morgan & Co. and a group of other international investors will maintain their planned stakes in Banco Espanol de Credito-Banesto for five years or more, Banesto chairman Mario Conde said at the annual shareholders meeting.
He told the shareholders that Morgan's participation in Banesto's proposed $1 billion equity expansion is not a speculative one with the intention of disinvesting within months.
"On the contrary this is a stable commitment in the medium term to the future of the bank," he said.
Mr. Conde said the agreement with Morgan's Corsair Partnership, which includes major international institutional investors, contains a clause that bars the investors from selling their shares for at least two years and says they intend to hold on to them for at least five years.
Mr. Conde said Morgan is committing its money to Banesto's future and will take a seat on the board. It will not taking a role in the executive management of the bank, Mr. Conde added.
The chief executive said Banesto intends to list shares on the New York Stock Exchange as part of an effort to raise its profile in international capital markets. He did not give a timetable for the listing.
Shareholders of Banesto, the third-largest Spanish bank, approved the equity offering and the appointment of Morgan vice chairman Roberto Mendoza to the Banesto board.
Some shareholders criticized the equity plan, which would dilute earnings while raising the capital ratio to 12% from 9.3%, and Mr. Conde's previous announcement that the 1992 final dividend would be omitted.
Resignation Proposal Rejected
A proposal asking for the resignations of Mr. Conde and managing director Enrique Lasarte was voted down.
The bank declared zero profit for the first quarter, allocating operating earnings to a special loan-loss provision.