BCP Banco Comercial Portugues SA

Banco Comercial Portugues SA's (BCP.LB, BPCGY, BPCGF) chief financial officer said Monday he is confident that BCP will pass the European Union's stress test on banks.

The tests, which have been underway since March, are designed to gauge the financial health of 91 banks from 21 countries across the European Union.

"We are confident" that BCP will pass the stress test after raising capital, Antonio Ramalho said on the sidelines of a press briefing regarding the completion of the Core Tier I ratio recapitalization program.

The European Banking Authority had planned to release the stress-test results later this month but the results will now be disclosed in July due to haggling among European regulators, the banks and their national supervisors over whether the banks submitted overly optimistic data, according to people familiar with the matter.

The goal is for the stress tests to help defuse the continent's financial crisis by easing fears that many banks are vulnerable to huge unseen losses.

BCP on Monday said it successfully concluded its EUR259.9 million rights issue, marking the last stage of a three-pronged plan to meet the recapitalization requirements outlined in Portugal's financial-bailout program.

BCP Chief Executive Carlos Santos Ferreira said that the program was executed successfully and that demand for the company's rights issue was 1.6 times larger than the 721,813,850 shares on offer.

"This operation was done in a situation...that was complex and complicated," given the credit-ratings downgrade and bailout-package request that occurred during the 80 days in which the recapitalization program was carried out, he said.

The company increased its capital by EUR1.37 billion and boosted its core Tier I ratio to a pro-forma 8.8% as of the end of March from 6.7% at the end of 2010.

The bank wasn't able to provide a more updated ratio because it hasn't closed its books for the quarter although Ramalho said it would be around the pro-forma level.

The bank still needs to reach a 9% core Tier I ratio by the end of the year and 10% by the end of 2012, according to terms of the country's EUR78 billion financial-bailout program.

Ramalho said the bank expects to reach the 9% level at the end of the year through deleveraging its loan portfolio and accrued earnings.

Plans to reach the 10% core Tier I ratio are also in the works but haven't been posted publicly, Ferreira said.

He said the bank will make every effort to avoid tapping into the EUR12 billion set aside in the bailout package for Portugal's banking sector. The European Union and the International Monetary Fund have allotted the cash in case banks need help in meeting their capital requirements.

-By Alex MacDonald, Dow Jones Newswires; 44-0-7776-200-924, alex.macdonald@dowjones.com

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