Portuguese bankers call for “common sense” and “celerity” in resolving political crisis

 In Banks, News

The CEOs of Portugal’s main banks have called for “common sense” and “celerity” in resolving Portugal’s political crisis that has seen the resignation of Prime Minister António Costa and the dissolution of parliament and a general election set for March 2024.

This to not add instability already caused by an unstable international situation with two conflicts (Ukraine and the Middle East) and high interest rates, reports the business daily Negócios.
“It’s a situation that is unpleasant to say the least, not just because of the reputation of the country, but because it puts the nation on hold, which it doesn’t need.
“I hope that common sense will prevail”, said BPI CEO João Pedro Oliveira e Costa at the Money Conference organised by Dinheiro Vivo this week.
BCP CEO Miguel Maya said that while the resignation of Costa did not change the way the country (as the S&P ratings agency also suggests) is perceived by the market and investors, “the consequences could change” according to online source ECO.
And added: “It creates apprehension regarding the country. It is not the prime minister’s resignation that leads to a degradation (in perception), but if we are slow to act, it could lead to that. We have to act fast, and make a decision now”.
According to Negócios, the CEO of postal service and bank CTT, João Bento, said the crisis was “undesirable” but offset by the approval of the State Budget 2024 by parliament.
Paulo Macedo, President of State-owned bank Caixa Geral de Depósitos said that resolving the crisis quickly still meant “a minimum of four months” (until the elections). “The (State) Budget should be approved, the next one should be rectified. Uncertainty should not be piled onto uncertainty. Reducing taxes should continue, as should the increase in public sector salaries”.
“I hope that people have a notion that things have to continue; continuing the development of the Banco de Fomento (Portugal’s development bank which is overseeing the distribution of EU Recovery and Resilience Plan (RRP) funds), and the execution of the RRP”, he added.
When asked if he would like to see the Governor of the Bank of Portugal and former Finance minister, Mário Centeno head a caretaker government until the elections, the President of Santander Totta, Pedro Castro e Almeida said he had “great admiration for his former colleague on his university course”. (both are economists)
“Portugal’s perception with investors won’t change in two or three months, but in the medium term could if a scenario of instability continues”, he said.
“The big risk for the country has to do with stability in the country’s management, and I would like to see the State Budget approved because the increase in pensions and reduction in IRS tax should not be postponed”, he added.