Sale of Portugal's Novo Banco enters new phase as economy rebounds slowly

The Bank of Portugal kicked off the negotiation phase for the sale of Novo Banco on Wednesday, according to a statement published on the central bank's official website.

The fourth phase "corresponds to the final decision and includes a period of negotiation with the potential buyer selected by the Bank of Portugal," the statement said. The negotiations are expected to run until the end of August.

The Bank of Portugal has never revealed the names of bidding companies. However, local media have reported that current bidders for Novo Banco include New York investment firm Apollo, Chinese conglomerate Fosun International and insurance group Anbang.

Novo Banco inherited the healthy assets of Banco Espirito Santo after the latter was bailed out in a 4.9 billion euro (5.45 billion U.S. dollars)package in 2014.

The new development of the sale of Novo Banco came amid a sluggish recovery of the debt-ridden country's economy.

Data released by the Bank of Portugal showed the country's economic activity indicator stands at a year-on-year increase rate of 0.8 percent in July, while the private consumption indicator for the same month is 2.1 percent.

The two figures indicated a decrease by 0.1 percentage points when compared to the June outcomes respectively.

Portugal is recovering from a recession that forced the country to sign a 78 billion euro (86.8 billion dollars) bailout in 2011.

The country's center-right ruling coalition has been enforcing harsh spending cuts and tax hikes in the past four years to meet budget targets. Endi