Vítor Bento leads banking association

 In Associations, Banks, News

The economist, one-time president of Novo Banco and head of financial payments processing company SIBS, Vítor Bento, is the new president of Portugal’s banking association APB.

Bento will replace Fernando Faria de Oliveira who spent 8 years at the helm of the Portuguese Banking Association, in December.
The suggestion that Vítor Bento would take the helm at the banking association had already been mooted by Jornal Económico in March.
Vítor Bento, who in 2016 famously said that Portugal’s banking sector was a guinea pig for new European banking rules for failed banks (Banco Espírito Santo collapsed in 2014), is an economist who knows the Portuguese banking sector well.
During the Great Recession he noted that Portugal enjoyed a boom based on borrowing that had almost all come via the banks – some of them at that time still in Portuguese hands.
Bento has said that in Portugal’s case, subtracting the large companies which had the capacity to get credit directly from the markets, in the rest of the economy the banking sector acted as an intermediary with sectors that benefited from the credit boom and which had many companies that were not sustainable.
He had warned that both construction and real estate growth had been excessive, and because the banks had been instrumental in that credit boom, lending to many resort, tourism and construction projects were unsustainable, it suffered the consequences when the economy took a downturn from 2011 onwards.
Bento had also said at the time that while other countries attacked their problems head on and the root causes as they occurred, Portugal had hoped that the problem would just sort itself out but it didn’t, and the banking sector found itself in a vulnerable situation five years later from 2014 onwards as all the consequences of over leveraged lending came home to roost.
More than this, Vítor Bento had argued that when the troika came in to Portugal in 2011, it would have been useful to create a vehicle to skim toxic credits off the balance books of the banks which would have required support from the European Commission. Had this vehicle been created at the start of the troika programme many of the problems Portugal had with its banks could have been avoided, particularly for those that were wound up like Banco Espírito Santo.