Parliament gives green light to Centeno

 In Banks, News

MPs at Portugal’s parliament have given the green light for the appointment of Mário Centeno as the new governor of the Bank of Portugal whose appointment was officially announced on Thursday.

They approved a report on the hearing on Mário Centeno, a former finance minister, becoming governor of the Bank of Portugal, with the ruling PS socialist party voting in favour and the centre-right PSD and Communist Party abstaining.
The report, which was voted on, on Wednesday afternoon, at the Economy and Finance Committee, saw the right-wing People’s Party (CDS-PP), Left Bloc (BE), Liberal Initiative, People-Animals-Nature (PAN) and one Social Democratic member, Álvaro Almeida vote against.
During the debate before the vote was cast, MPs made it clear that they did not agree with the choice of Centeno for the Bank of Portugal top job because he had just been finance minister.
They had decided to block the expected appointment on grounds that there is a conflict of interest which is detrimental to the central bank’s independence.
Centeno, a former university professor, has previously worked for the Bank of Portugal as an economist.
Portugal’s President of the Republic, Marcelo Rebelo de Sousa, sees no problem with Mário Centeno’s appointment and said such a transition from the Ministry of Finance to the central bank had already taken place twice in Portugal’s modern history.
According to ECO, asked if in principle there could be any reasons why Mário Centeno could not take up the post on an ethical or political level, he said ‘no’ and cited the case of Pinto Barbosa who was a finance minister and then governor of the Bank of Portugal between 1966-1974 during the Salazar period; and again Miguel Beleza who had been the finance minister under the PSD government of Cavaco Silva who had also gone on to lead the central bank between 1992-1994.
In other news concerning the Bank of Portugal, the return on assets of non-financial companies stood at 7.6% between January and March says the central bank.
The value is the same as in the same period of 2019, but 0.2% lower than that recorded in the fourth quarter of 2019.