Portugal’s Finance Minister Maria Luís Albuquerque has created her own, rather wonderful fairytale around the collapse of BES and the failure of the regulators.
Believing every word of her carefull prepared version of events, the minister informed representatives from the Central Banks of the world's Portuguese speaking countries that the BES case showed that the financial system in Portugal is "more robust and ready."
The finance minister admitted that the problems at BES had increased the risks and challenges to the financial system but the way this particular case had been handled showed a "more prepared and more robust" system.
Maria Luís Albuquerque was speaking during the XXIV Lisbon Meeting of the Central Banks of Portuguese Speaking Countries, whose delegates will be grown up enough to make up their own mind as to Portugal's handling of the BES collapse.
Albuquerque said that she did recognise that a sustained effort is needed to ensure the stability of the financial system, but all is well as the BES case showed a system that was "more prepared and truly integrated into the new robust European regulatory model."
The minister highlighted the need to ensure the soundness of the financial system, considering that this is of the utmost importance and is fundamental to the stability of the economy.
The response to this series of truisms was not recorded but the version of reality given by Albuquerque, who worryingly appears actually to believe much of what she is saying, differs to the state of affairs Portugal has had, and continues to maintain.
The central bank has had no senior changes and is as ill-prepared for the next financial collapse as it was the last. It mishandled the BES collapse by shovelling taxpayers’ money at the problem without telling anyone and now seeks to sell of its bastard child, Novo Banco, to the first person through the door wearing a suit and with a cheque that won’t bounce.
There have been no legislative changes to stop crooks and money launderers like Ricardo Salgado and the city sees a ‘business as usual’ sign over the Bank of Portugal’s front door.
