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Finance Minister Mário Centeno spared no criticism of Banco de Portugal’s (BdP) management of the situation at Novo Banco in 2015, calling it a “wild capitalization”. During a hearing on the 2020 Stability Program and the National Reform Program, the institution led by António Ramalho ended up dominating the discussion.
“Due to the savage capitalization made by Banco de Portugal to Novo Banco in December 2015, the Portuguese economy faced long months of segregation in financial markets, lack of confidence with interest paid, clearly above the path of interest . of the Portuguese economy, ”said Mário Centeno, at the hearing in the Committee on Budget and Finance, this Wednesday.
The minister says that the consequences were visible in the financial costs of the Republic. “Of the issues carried out in 2016, we paid 1,500 million euros more than we would have paid if instead of the Novo Banco it had been voted and delivered to the Banco de Portugal, without any political responsibility for who at that time should be the guarantor of the Country financial stability, if it had been done differently, “he said.” We are all paying, “he said.
At the beginning of the hearing, Mário Centeno had already considered that “this was the most disastrous bank resolution ever made in Europe.” He argued that the selection of assets in 2014 was “poorly done, incompetent”, and stressed that “the bank that was new still had many problems and, therefore, in 2017 a capital mechanism appears.”
The supervisory minister criticized the management that was carried out in 2015, considering that “the bank that was new and that should be good still had many bad things.”
Novo Banco was the main topic of debate in the audience, both in the explanations of Mário Centeno and in the questions of the deputies, who asked for explanations about the loan of 850 million euros from the State authorized by Finance last week, or about the Government position regarding the possibility of deferred bond payments to the bank’s administration in 2021.
(Updated at 12:23 pm)
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