Banco de Portugal reinforces provisions to avoid losses

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By 2022 the institution will have achieved operating results of over 600 million euros. The idea will be to use great caution in the cushion to be reserved.

The Bank of Portugal should reinforce provisions to avoid losses in the 2023 accounts, reports Eco on Tuesday.

According to the newspaper, the institution led by Mário Centeno should thus become an exception in a scenario of heavy losses for central banks in the face of rising interest rates paid on deposits by commercial banks and lower yields on the debt they keep on their balance sheets.

Eco says that in 2022 the Bank of Portugal will have obtained operating results in excess of 600 million euros, a figure on which taxes and provisions for possible contingencies must be deducted. The idea will be to use great caution in the cushion to reserve, he says.

The Bank of Portugal does not indicate which value will be set aside, but refers to recent statements by Mário Centeno on last year’s results, noting the fall “in a substantial way” in results and dividends. The government expects to collect 240 million euros in dividends, a 40% decrease from the previous year.

 

The risk of negative results is the loss of credibility for central banks or even a possible threat to the independence of institutions in the need for a capital injection by the State, according to economist Miguel Faria de Castro, quoted by Eco.

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