Nationalization of the New Bank is “almost impossible” – TVI24

President of the Portuguese Banking Association (APB), Fernando Faria de Oliveira, said today that a possible nationalization of the New Bank is an almost impossible process meet new European rules, forcing the resolution of the bridge bank.

“nationalization is not an easy process, and I would even say that it is very difficult to put into execution. in the context of a resolution, there is a provision allowing, in exceptional conditions – that jeopardize the stability of the financial system – a nationalization that has to be approved by the Commission “, he told Lusa responsible

.” But that was happened. what was resolution object was BES and that was not the choice made, “he stressed, on the sidelines of an event in Lisbon, stressing that” the option that APB defended at the time was the use of recapitalization line “.

According to Oliveira de Faria this was “the best way”, but it was not the solution adopted, “is already part of the past.”

the official explained that “in the current circumstances, what is in question is a bridge bank. And there are, in terms of the legal framework, well-defined rules in relation to a bridge bank “.

So” nationalize a bridge bank in the new framework which entered into force on January 1st is not possible without a prior resolution of the New Bank “, he stressed, so this” is a process that is almost impossible to be realized. “

Still, Faria Oliveira admitted that “there will be some bargaining power on the matter”, but considered that the most important is to bet on the sale of the institution.

“Let’s see if manages the sales process goes well and if possible, to find a buyer who is very credible and permitting the Portuguese banking system configuration where in any case there is a significant weight of the national banking “ launched.

the leader of APB pointed out that from the perspective of banking, the goal is that “the sale to make in order to maximize the sale value and, thus, reduce the effort that eventually banks will have to do that will match the difference between the 4.9 billion euros of initial capital of the new bank and the amount made from the sale. “

in terms of timing, Faria Oliveira said that “should be defined by those entitled to and should always have in mind this objective to minimize any stress in the banking system.”

the official also said that “it is important to consider that the resolution itself itself contains ingredients that actually hurt competition “but” also bring advantages to the banking system, no doubt because they avoid systemic crises. “

to the spokesman of the bank, “there is no doubt that other banks are to allow the continued activity of a bank that was in very difficult situation and, on the other hand, the very act of sale, may end up doing almost a kind of subsidy to the buyer “

He went on.” These are matters which, from the point of view of competition, were certainly designed by politicians who defined the regime and which in fact have as a counterpart to avoid systemic risk, but have something of a controversial “.

Therefore, in his view, ” important that the process of sale goes well. It is very well designed in terms of sales method, which is currently open, and in terms of timing ‘ “.

Faria de Oliveira concluded that the expectation banks is that “either the government or the regulator work together for it to be successful.”