Bank mergers inevitable in Portugal says Finance Minister
The governor of the Bank of Portugal, Mário Centeno, says consolidation in Portugal’s banking sector is “inevitable”.
In an interview with Reuters, Mário Centeno said that the recent progress that banks in Portugal had made in terms of beefing up capital reserves and cutting risk was “extraordinary”.
“After strengthening its capital, the consolidation of the banking system (in Portugal) and the strengthening of its institutions is absolutely crucial and inevitable and the market should be aware of this”, he said.
Despite the pandemic and current crisis having postponed this process “we’ll do it calmly, as always”, added the Governor of the Bank of Portugal.
In Portugal five banks hold 80-85% of all bank assets, but nevertheless there are those calling for more mergers and acquisitions to make the sector more competitive.
Centeno said after Non-Performing Loans (NPLs) had reached a shocking €50Bn in 2016, NPLs had now fallen to €11.3Bn, in line with the European average, according to the latest report from the Bank of Portugal.