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In 2017, when Novo Banco was sold, to 75%, to Lone Star, a contingent capital mechanism was created that would force the Resolution Fund to inject capital into Novo Banco when it was necessary to replace the institution’s assets due to assets that they remained in this financial institution created in the BES resolution.
The contingent capital mechanism was created with a maximum injection of 3.89 billion euros. In the first three years alone, Novo Banco needed 2,978 million euros.
This year also happened in May. But it was a controversial payment, since it happened earlier this month.
In 2018, due to the 2017 losses, the Resolution Fund passed the check to Novo Banco at the end of the fifth month of the year. It was on May 24, 2018 that the check for 792 million euros reached the bank directed by António Ramalho, according to a statement from the entity. In 2019, the check was issued earlier. Also according to public information, the Resolution Fund transferred 1,149 million euros to Novo Banco on May 6.
These amounts have underlying state loans. In the first year, the loan was 430 million euros, and thereafter, each year, it was 850 million euros.
The amount to be injected this year, due to the 2019 results, reaches 1,037 million, of which 850 million are public loans to the Resolution Fund. It is now also known that the Resolution Fund finally delivered two million less than expected. According to Expresso, the injection into the bank was 1,035 million, due to the Resolution Fund’s refusal to pay two million corresponding to the charge for paying bonuses to the executive board of directors led by António Ramalho from 2022, but which may remain registered in previous years. The company had already reported a 7% increase in salaries for the Novo Banco administration in 2019, and almost 5% was the increase in Ramalho’s salary. This in the year that presented losses of 1,058.8 million euros and requested the 1,037 million euros from the Resolution Fund.
In order to inject this money, once again, the Fund resorted to a state loan of 850 million euros. The money followed earlier this month. And this is where the new controversy involving the Novo Banco begins.
The Costa controversy was not reported
On April 22, in the biweekly debate, Prime Minister António Costa, in response to questions from the PAN and the Bloc, assured that the Novo Banco audit would be completed in July, saying that its results would be “fundamental to decisions” . to be taken by the Government under the terms of the contract with Novo Banco. Answer given to a request from PAN that asked the Government to suspend the transfer of 850 million euros this year.
Fifteen days later, the theme returns to the Chamber, again through the voice of Catarina Martins, coordinator of Bloco de Esquerda. When this deputy, António Costa, asked him in the biweekly debate on May 7, he said: “until there are no audit results” in progress at Novo Banco “there will be no reinforcement of the state loan to the Resolution Fund.”
“He told me in the last biweekly debate that he thought it was not possible to make decisions about Novo Banco and more injections of public money without knowing the results of the audit. We still do not know the results of the audit, the deadlines are passing and they are exceeding “stressed Catarina MARTINS.
That same night, Expresso reported that the money had already gone, that same week, to the Resolution Fund, which subsequently capitalized Novo Banco. And wrote: “the the prime minister was unaware of the transfer, and has already apologized for the error. ” António Costa, who clarifies to Expresso: “the Prime Minister has already apologized to the Left Bloc for having responded to the ignorance that the Ministry of Finance already had yesterday [6 de maio] contractually provided for payment. “
The next day, António Costa gave a public explanation, saying that he had not been informed of the transfer.
“I had not been informed that the Ministry of Finance had made this payment the day before,” the prime minister said, speaking to journalists at the end of an initiative in Porto on Friday. Mário Centeno, Minister of Finance, was at that time in Brussels, at the Eurogroup meeting, which he chairs.
It was after that meeting that the Deputy Secretary of State for Centeno, Ricardo Mourinho Félix, reported that: “Novo Banco was sold in 2017 and […] There is a contract that stipulates that, after the presentation of the Novo Banco accounts and after being audited by the Novo Banco auditors, verified by the verification agency, validated by the monitoring committee and approved by the Resolution Fund, there are a place for capital injections. ” Novo Banco accounts were presented at that time […] and the timing of the injections doesn’t vary much from year to year, “added Ricardo Mourinho Félix. Nothing has yet been said about the Ministry of Finance not informing the prime minister.
Public already said this Saturday that the request from the Resolution Fund to the State to transfer the loan of 850 million euros came in early April, so the Government had had a month to stop this transfer.
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