The governor of the Bank of Portugal will not be dismissed, says Louçã

  • ECO News
  • 4 May 2017

The former leader of the Left Block believes Carlos Costa's dismissal is no longer an option and highlights the relevant signs of the reconstitution of the administration of the Bank of Portugal.

Replacing Carlos Costa as the governor of the Bank of Portugal is a dead issue. Francisco Louçã is the one who says so, in an interview to Público and Rádio Renascença in which he mentions the current context no longer justifies the dismissal of Carlos Costa. He also highlighted the change in the administration team of the banking regulator allows the Bank of Portugal to “recover its seat”.

According to the economist now belonging to the Bank of Portugal’s advisory council, the reasons which could justify replacing the governor have been exhausted — namely following the “very serious crisis” around the Bank of Portugal and the resolution process of Novo Banco. Francisco Louçã states: “The Government chose not to do so [begin the process of replacing the governor] and, therefore, it is a dead issue, there is no replacement process for the governor and there won’t be one in the current context”.

Francisco Louçã believes the changes in the administration of the Bank of Portugal, recently approved by the Government, contribute, in fact, to a reinforcement of Carlos Costa’s continuance as the leader of the regulator. “The Bank of Portugal even recovered its seat, because it reconstituted its administration with signs that seem relevant to me, concerning its effort and competence”, Louçã states.