Novo Banco, an abscess with no cure in sight. Editorial

The government has already carried out an audit by Deloitte which found no “relevant discrepancies” in the management of Novo Banco. Parliament will shortly receive an assessment of the institution’s accounts. Then a few pieces of work by a commission or another, an assessment or another from the resolution fund are enough, and the government there has to pay out up to 600 million euros to make up for the bank’s losses again. This has been the case for years, and this time neither the intervention of Parliament, which banned € 478 million from the 2021 budget for the operation, will save the country from this outrageous loss. Nothing to say: Novo Banco has the right to claim this money on the basis of a contract signed by the state and the state must accept what it signs; But something to say: Annual transfers to Novo Banco have become the most painful abscess of our democracy.

For further audits and parliamentary commissions to be carried out, the country has already recognized the success of having been part of a treaty signed by the PS government and approved by the Banco de Portugal. In this form, the sale of assets justifying the request for public capital injection is in accordance with the contract and, according to Novo Banco’s management, is integrated into European requirements and best international practice. In essence, however, the story of Novo Banco is much simpler beyond financial jargon and the impenetrable jargon of lawyers: a well-organized operation of appropriating state funds with legal cover.

As much as António Costa, Mário Centeno and João Leão try to justify their surrender through more or less scrutiny, the essential part of this attack on our rights as citizens and taxpayers is well reflected in the statement by João Costa Pinto, former Deputy Governor of the Banco de Portugal, in Parliament: “When funds are used, on average they specialize in recovering investments in three years and earning 15% to 20% a year”, which implies that “asset devaluation is not possible less.” than 50% “,” significant losses “are inevitable. Now it was the “extraordinary” conditions given to the buyer when selling loans and their implementation by the management of Novo Banco that weighed on him.

In the presentation of the 2020 financial statements, António Ramalho, CEO of Novo Banco, announced a light at the end of this dark tunnel, saying that the institution is recovering and that “everything must come to an end”. And he left a wish: “I hope the state is not called.” Can we believe the end of the nightmare even after the EUR 3.9 billion pledged to guarantee losses has been used up?

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