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In 2021, and unlike the State Budgets approved in previous years, the State Budget does not foresee any loan to the Resolution Fund, says the statement from the Ministry of Finance after the delivery of the document to the Assembly of the Republic.
After all, the 468.6 million medium and long-term loans entered in the exceptional expenses budget are not for the National Resolution Fund, but for CP – Comboios de Portugal.
The State Budget was delivered earlier than last year, by the Minister of Finance, but it was not without errors. “By mistake, the OE21 report, today delivered to the Assembly of the Republic, erroneously identifies a loan of 468.6 million to the Resolution Fund. It is a loan of 468.6 million euros to CP-Comboios de Portugal “, admitted the Ministry of Finance in a statement while guaranteeing that” it will immediately correct the document. “
In the same statement, the Ministry led by João Leão guarantees that OE2021 does not foresee a loan from the State to the Resolution Fund, to inject it into the Novo Banco, thus going against the will of the Left Bloc.
Several sources explained to Jornal Economico that only banks will finance the Resolution Fund.
The banking syndicate that will finance the Resolution Fund in 2021, is composed, like the first-hand Economic Jornal, advanced by CGD, BCP, Santander and BPI. The amount of the loan is not yet closed, but according to our sources it could range between 250 and 400 million euros.
The Resolution Fund still has its own income that it will inject for the contingent capitalization of Novo Banco.
The State has not entered into the State Budget proposal an authorization to lend money to the Resolution Fund. This is the first year in which there is no amount registered for financing authorization by the State. Except for the first call for capital, in 2018, in which the State lent 430 million euros, each year the State has registered 850 million loans to the Resolution Fund in successive State Budgets.
The Resolution Fund needs a loan to close the gap between its own income from the Fund and the injection of capital to Novo Banco under the contingent capitalization mechanism.
The Fund does not have sufficient income to comply with the last call for capital from Novo Banco, so financing is being prepared through a banking syndicate made up of CGD, BCP, Santander and BPI to finance between 250 and 400 million, as advanced Economic Journal in Friday’s edition.
Last year, the Resolution Fund received 253.8 million euros in contributions “directly or indirectly from the banking sector” and of these, 185 million were used to inject this year the 1.035 million of the capitalization of Novo Banco under the Agreement . Contingent Capitalization Plan. The remaining 850 million were provided by the State under the framework agreement that was approved by the Council of Ministers in October 2017.
2021 is expected to be the last year of the capital call and the Left Bloc has been intransigent precisely on the verge of Novo Banco becoming autonomous in the face of the contingent capital mechanism; as the cleanup of problematic assets that make up the BES legacy is expected to be completed this year, as is apparent from the commitments made to the European Commission.
Today Duarte Cordeiro, Secretary of State for Parliamentary Affairs, guaranteed that the State Budget document for 2021 contains the answers required by the Left Bloc in the areas of social protection, health and even in the Novo Banco file.
It should be remembered that the Left Bloc has made parliamentary support for this Budget of the Socialist Government depend on the fact that there is “not a penny” for Novo Banco. Today Catarina Martins came to say that the Block does not approve the Budget as it is.
Regarding the fact that Novo Banco is out of OE2021 and is a consortium of banks to finance it, the blocker said that the Government informed BE that it intends to continue having an authorization in the State Budget, for the injection of the Resolution Fund in Novo Banco. .
“The Left Bloc was always against the Novo Banco solution. At this moment there are strong indications that Lone Star, Novo Banco’s largest shareholder, is carrying out a management that harms the bank itself and the public treasury. What the Government is telling us is that there cannot be money from the State Budget this year, there may be a loan from the banks, but it is a loan to the Resolution Fund. In other words, in the end it is always the taxpayers who will pay, although they will not pay this year, but next year, ”said the party leader.
Since the State is not authorized to lend money to the Resolution Fund in this SO, this loan can only come from private sources.
Of the Contingent Capitalization Mechanism created with the value of 3,890 million, 912 million euros remain.
Any estimates of what the Resolution Fund may need to finance Novo Banco will only be confirmed in 2021, when Novo Banco will calculate the amount of capital needs for losses in 2020.
In 2017, the Government approved, in a resolution signed by António Costa himself, a framework agreement that allowed the Resolution Fund to annually access State financing if necessary under the Contingent Capitalization Agreement.
The operating rules of this contingent capital mechanism establish that the Resolution Fund must make capital injections of up to 3,890 million euros, if the problem assets present losses that compromise a certain level of the capital buffer created to absorb these impacts. These reinforcements are expected to be financed with new loans from the State, the interest and principal of which will only begin to be paid by the Resolution Fund as of 2046.
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