The Left Bloc leader, Catarina Martins, has insisted to parliament that the directors’ salaries at Caixa Geral de Depósitos are "not a done deal" and can still be reduced.
Martins was enthusiastic in her debating style, stating that the Prime Minister has her party’s "full opposition to the salaries for the new management at the State-owned bank.
The new chairman of the board at Caixa Geral, António Domingues, has managed to get the salary for his position raised by 70% to €423,000 basic plus a 50% performance bonus.
The issue of these 'millionaire salaries' is "simply unacceptable" for the Left Bloc leader but Prime Minister António Costa did not want to get involved in debating the issue and simply moved on to the next topic, such is his style.
This Government has already approved the decree law that ended the ceiling on public sector salaries that had been set at no more than 90% of the salary of the President of the Republic of Portugal.
This has allowed Caixa’s directors to take full advantage in obtaining salaries in line with private sector bankers, rather than those that serve the State in running the taxpayer-owned Caixa Geral.
There also exists a "regime of exception" for Caixa Geral directors who have no requirement to submit income statements to the Constitutional Court, incompatibilities and impediments to the Attorney General, and shareholdings to the General Inspectorate of Finance.
As for the bankers’ bonuses, with a recapitalisation of Caixa Geral certain to involve the taxpayer funding the €5 billion needed, it should not be beyond the ability of the most mediocre banker to turn the institution from its current dire financial position into a profitable enterprise.
The creation of a national ‘bad bank’, a distinct possibility with the prime minister and the governor of the Bank of Portugal in agreement for once, will further help Caixa Geral’s directors in their task of restoring profitability with all the bank's Non Performing Loans wiped out.
Caixa Geral de Depósitos has been run so badly in the past decade that anything is an improvement. Theft, corruption, favouritism and the poorest of checks on directros' behaviour led the bank to the brink of collapse, a state of affairs cunningly concealed by the Passos Coelho government.
With salaries now set at competitive rates compared to remuneration levels at other of Portugal’s banks, much will be expected of Domingues and his well-padded team.
