LISBON, Dec 6 Reuters The three owners of Portugal39;s fourthlargest bank Novo Banco have agreed to lift a ban on dividend payouts, paving the way for its potential sale or an initial public offering in 2025, the finance minister was quoted as saying on Friday.

Joaquim Miranda Sarmento told the Expresso newspaper the agreement, involving the state and Portugal39;s banking resolution fund, and the majority owner U.S. private equity fund Lone Star, is an important milestone for the Portuguese financial system.

Novo Banco was created in 2014 from the remains of collapsed lender BES after a multibillioneuro government bailout. Lone Star acquired a 75 stake in 2017. The Portuguese resolution fund and the state own the remaining 25 stake.

The bank has been banned from paying out dividends until December 2025, leading to it becoming overcapitalised with a core Tier1 fully loaded capital ratio of 20.7, more than double the minimum requirement of 9.3.

Unblocking dividends is a necessary condition for any stake in the bank to be offered, be it in an IPO or direct sale. Novo Banco CEO Mark Bourke has said the bank would be ready to launch an IPO early next year.

Three sources with knowledge of the matter told Reuters in September that Lone Star is considering a sale as well as an initial public offering.

The dividends deal should allow Lone Star to pocket around 900 million euros 956 million in dividends in 2025, while the fund and the state would get a total of around 300…