The remains of the former Banco Internacional do Funchal (Banif) and Banco Português de Negócios (BPN) continue to require additional efforts from taxpayers and the state budget.
The planned new expenditure to continue supporting the two processes amounts to approximately EUR 300 million, the same as the planned increase in child benefits in 2024, or three times the planned increase in revenues from the Single Circulation Tax (IUC).
The BPN case has been going on for about fifteen years; Banif’s turns eight years old at the end of this year.
According to the new OE proposal (OE 2024), which will be debated in Parliament next Thursday (26th), the Minister of Finance, Fernando Medina, shows that he still cannot get rid of the legacy burden of these two private banks come.
According to calculations by Dinheiro Vivo (DV), based on the maps of the budget proposal, the largest expenditure slippage appears to be concentrated in entities that still hold problematic assets, with less liquidity and, in some cases, toxic assets or ‘junk ‘. inherited from the small to medium-sized private bank Banif.
According to the research carried out, the request for approval of expenditure that Fernando Medina will address to the deputies of the Assembly of the Republic in the case of the Banif universe will amount to 258 million euros.
Taking into account the absolute majority of the PS, the objective should be successful.
In any case, this is a very significant amount, with the aggravating factor being an increase of 23% compared to the budgeted expenditure approved for the current year (2023) and more than double the expenditure incurred in 2022, which, according to the General State Account for that year (CGE 2022), generated government expenditure of 101 million euros.
Serious cases
The Banif Imobiliária entity needs another 79 million euros in 2024, Banif SA another million, the Oitante company needs another 156 million euros and Wil – Projetos Turísticos another 24 million euros next year.
For several years now, the former Banif has been the item that has contributed most to the annual increase in expenditure on government support to banks.
At the end of last year, the net costs imposed on taxpayers as a result of the intervention in Banif already amounted to 3 billion euros, according to the Court of Auditors.
And apparently, taking into account the budget expenditure, which has now been recorded in the two subsequent OEs, an increase in the bill remains latent.
The BPN case is, among the rescued private banks, one of the heaviest for taxpayers (in absolute terms the bill already exceeds 6 billion euros at the end of 2022, surpassed only by the 8.3 billion euros of BES/New Bank).
The vehicles linked to the former BES have already disappeared from the OE, but the aforementioned €8.3 billion in aid provided by Portuguese taxpayers will be lost forever.
15 years after the nationalization of the small bank founded by José Oliveira Costa, linked to several national political figures (mainly from the PSD), it seems that the balance sheet has finally stabilized, although the account has not yet been closed.
In the case of Banif, the government has justified that it is necessary to provide the vehicles with new funds, because they have to enter into “multi-year commitments” to sell assets and recover credits, and pay for the services of financial and legal advisors. and companies that, for example, specialize in real estate management and sales.
Oitante is the owner of assets that Banco Santander did not want to buy in the deal closed at the end of 2015 (some properties for example), as part of the resolution process.
The vehicle Wil manages “tourism projects”, but detailed information about what it actually does has never been plentiful here.
The company Banif Imobiliária, owned by Oitante, also had a portfolio of properties to sell.
BPN stabilizes after 15 years
In the case of BPN, the state transports the famous “pair companies”, the three vehicles that housed the good, not-so-good, bad and terrible assets of the bank that collapsed and was nationalized by the PS government, led by José Sócrates . 15 years following November 2, All Souls’ Day.
The trio Parvalorem (the most important), Parparticipadas and Parups will need an expenditure of only 36.5 million euros in the OE 2024, but this value is comparable to the 267 million requested in 2023 or to the implemented expenditure of 210 million euros in 2022.
The revenues that year were in any case more than sufficient to compensate the costs: for the first time, after thirteen years, BPN gave the State a profit, the Court of Audit (TdC) confirmed in the most recent advice on CGE 2022.
Parparticipadas is the holding company that manages the former BPN’s shares in other companies and funds that orbited the bank, Parups is the vehicle that manages properties, works of art, collectible coins and various financial instruments, and Parvalorem is the fund that manages BPN’s problematic credit manages. portfolio.
The money injected into these companies all these years mainly served to finance the recovery of assets, paying interest and capital on loans granted by CGD (one of BPN’s main creditors), supporting the sale of properties , paying for lawsuits and lawsuits.
As mentioned, all these financial vehicles appear in the OE budgeted as costs, but on the other side of the balance sheet, revenues are expected to support them and even exceed expenses, so as not to immediately result in a public sector deficit. accounts.
With the exception of the support for BCP and BPI (which together generated a profit of one billion euros to the state) and the large capitalizations of CGD (but this is a 100% public bank, which regularly pays dividends, now that they have returned to profits) , the rule since the beginning of the banking crisis has always been a loss at the end of every year.
But apparently the BPN gap will finally be stabilized in 2022, according to the TdC.
The public accounts disaster
This does not mean that the disaster that the banks have inflicted on the public accounts and debts can be erased or undone. On the contrary.
The global deficit imposed on taxpayers just because of the support given to the banks (taking everything into account – capital injections, loans, interest paid – and offsetting this burden with the revenues obtained) is, by any measure, monumental and amounted to approximately 21 .9%. billion euros by the end of 2022, according to the TdC.
This was the cost of saving the financial system as a whole, the savers who could have been left without time deposits, but not only that, as we know today from the countless cases heard in court and those still pending be pending.
According to the Court of Auditors, “in 2022, for the first time since the start of the 2007/2008 international financial crisis, the balance between revenues and expenditure of State support to the financial sector was favorable to the public sector (165 million euros )”.
“The turnover amounted to 173 million euros and is mainly due to the partial repayment of the loan by Parvalorem (121 million euros) and dividends from CGD (50 million euros).”
“The costs totaled 8 million euros and were almost entirely due to the expenses incurred in the reprivatization of BPN (7 million euros),” the same court reports.
In addition to budgeted expenditure, which may not be matched by revenue, creating a deficit, the state also has very high debts in some of the financial instruments mentioned.
Among the group of debtor public companies included in the fiscal consolidation perimeter, the most serious case is that of Parvalorem, which owed more than 5 billion euros at the end of the first half of this year. It is one third of the total debt that the public sector owes to the state.
Parparticipadas also appears with a debt of 125 million euros.
Source: DN
