Ricardo Salgado, the former head of Banco Espírito Santo, is to have his capped pension restored to the full entitlement.
Salgado’s monthly pension from the funds of the shattered BES empire will rise from the current €29,000 a month to a more comfortable €90,000, starting next month.
The rise comes after the regulator decided that the ceiling imposed on pensions by Vítor Bento had no 'legal appropriateness.'
The same pension treatment will apply to more than a dozen former managers of Banco Espírito Santo with retroactive payments from September 2014 being made to restore past underpayments.
Vítor Bento was brought in to manage Novo Banco and put a cap on the pensions of members of the BES executive committee and many former managers. He did not last long as he disagreed with the Bank of Portugal on the timing of a sale for Novo Banco, saying he needed time to get the bank into a saleable state - history proved him right.
The managers of the BES pension fund believe that the opinion of the regulatory authority means that they have to recalculation the pension payments in an upward direction.
To reduce costs at BES, Vítor Bento had used part of company law which allows limiting pension payments under certain circumstances.
The management company for the BES pension fund passed the matter to the regulator which has now declared, "...we understand that there is no reason to defer payment to former members of the Executive Committee of BES."
How the public will react to Ricardo Salgado’s pension arrangements remains to be seen.
But it’s not just Salgado as there are a dozen former managers of BES in the same circumstance; José Manuel Espírito Santo, Rui Silveira, António Souto and José Freixa all receive pensions of between €43,000 and €90,000 a month.
Making good the lost pension payments for 19 former employees of BES will cost €62 million and it is notable that for a bank that went bust owing shareholders and investors billions, that the former top man and his team of ‘yes men’ are well cared for.
