Carlos Costa: Bank of Portugal did not change provisions to give the State more dividends
The governor of the Bank of Portugal says the provisioning policy has been the same since he took office. The amount of provisions only decreased because the portfolio risk also decreased.
The Bank of Portugal gave the Portuguese State record dividends of 525 million euros concerning 2017, an amount that stood 50% above what it had given in the previous year. However, the governor assures no provisions were released to justify the soar in the volume of dividends. Carlos Costa states the provisioning policy has been the same since he took office.
“The provisioning policy has been the same since I took office”, the Bank of Portugal governor stated, during the Finance and Budget commission. This policy “is based on a shared European methodology that assesses the risk associated with the portfolio, taking the medium-term scenario into consideration”, Carlos Costa adds.
“There has been a decrease of the risk associated with that portfolio” and, therefore, “there are less provisioning demands”, the governor explained. According to the 2017 annual report, general provisions for the central bank have fallen to 3,727 million euros, in comparison to the 4,247 million from the previous year.
The Bank of Portugal gave 525 million euros to the Portuguese State last year. This transfer reflects the profits gathered by the institution headed by Carlos Costa during 2017. According to the annual report, the net result of the Bank of Portugal ascended to 656 million euros in 2017, translating a 48% increase in comparison to 2016.
