Portugal pays IMF another 800 million euros. The check from Santander Totta has arrived

  • ECO News
  • 28 August 2017

The Government had announced it would make a 2,600 million euros' early repayment to the IMF by August. This month, Portugal payed another 800 million euros, owing now less than 40% of the IMF's loan.

Portugal has made a new early reimbursement to the International Monetary Fund (IMF) in August. The Portuguese Debt Management Agency (IGCP) payed around 800 million euros to the Fund this month, meaning the total amount repaid to the IMF in two months in now 2,600 million euros, as promised. The operation emerges after Portugal received a 2,300 million euros’ loan from the bank Santander, within the agreement on swaps. Now, Portugal only owes 37% of the loan granted by the IMF concerning the 2011 financial aid.

In June, Portugal had already repaid one billion euros to the IMF, having promised to return another 2,600 million to the IMF by the end of August. In July, around 1,750 million euros were reimbursed. This Monday, the agency managing Portugal’s public debt stated in their monthly bulletin that they made another 800 million euros’ reimbursement.

This reimbursement happens after Lisbon received the green light from its European partners to accelerate the repayments of the IMF loans earlier than schedule. The goal is simple: to take advantage of better conditions in the primary market to write off the more expensive debt it owes to the IMF since 2011.

“IGCP reimbursed in August SDR 668 million of the IMF loan, which increases the percentage paid of the total IMF loan to 63%. These repayments discharge scheduled IMF principal repayment obligations that were originally to fall between March and April 2020”, states the agency headed by Cristina Casalinho in the report.

"IGCP reimbursed in August SDR 668 million of the IMF loan, which increases the percentage paid of the total IMF loan to 63%. These repayments discharge scheduled IMF principal repayment obligations that were originally to fall between March and April 2020.”

IGCP

Monthly Bulletin

 Saving 660 million euros

This year, Portugal has already made a 3,600 million euros’ reimbursement to the institution headed by Christine Lagarde. The idea is achieve the 10,000 million in 30 months — meaning, by 2020, the Executive intends to have returned another 6,400 million euros.

This had been announced in July by Ricardo Mourinho Félix, the Portuguese Finance State Secretary, who stated this would create savings of around 660 million euros in IMF’s debt invoice.

Mourinho Félix explained that the 2,300 million euros’ loan from Santander, within the agreement made with the Portuguese State on the case of swaps sold to public companies, would partly be used for this early repayment.