A project to develop an Investment Bank to support the Portuguese economy has been completed, and the bank is expected to start functioning in January 2014, with a capital of €5 billion.
Angela Merkel, the German Chancellor, has approved the project, and the investment bank project is now ready to move forward to its next stage.
The plan is to start negotiating in the first quarter of 2013 with European authorities, in order to channel part of the funds of the next community support framework QREN to the new banking institution.
The project for the bank was undertaken by a team from the Ministry of Finance, and it is proposed that 25% of the European funds destined for Portugal is used to enable better management and effective use of the funds.
Last weekend, Carlos Costa, Governor of the Bank of Portugal, sent a document entitled the “Multiannual Financial Framework 2014-2020” to Faria de Oliveira, chairman of CGD and president of Portugal’s Bank Association (APB), and Ricardo Salgado, president of BES.
The document describes the advantages of having a financial institution that is not a competitor to commercial banks, with a “goal to finance the economy based on the €20 billion that Portugal will receive between 2014 and 2020, within the context of the next Community support framework”.
The idea of an investment bank was initially scoffed at by the Portuguese banking sector (Ricardo Salgado included) as a “waste of time and resources”, a phrase used by Fernando Ulrich, president of Banco Português de Investimento (BPI). Recently, the banking sector opinion has turned, with Salgado stating that the investment bank “could really help Portugal’s small and medium enterprises to obtain better financing conditions in the long term”.
