On Monday, the Bank of Portugal released a financial stability report.
The governor of the Bank of Portugal, Mário Centeno, called on Monday to get rid of the economic crisis “while maintaining financial stability” and warned that it is necessary to prepare for the transition period after the suspension period ends. September.
For Centeno, the economic recovery “can only be sustained if financial stability is present.”
“We will face the end of the moratorium. (…) We must prepare for the post-September period that marks the end of the moratorium,” the governor said at the meeting to submit the “Financial Stability Report”, which the Bank of Portugal released today .
Centeno argues that “for this, all economic sectors must initiate a deleveraging process”, which Portugal followed in the period before the 2020 crisis. “Everyone must participate,” he called.
He said that as the ban is coming to an end, “it is necessary to adopt temporary measures in certain activity sectors, especially accommodation and restaurants”. If economic activity in these sectors increases, “extra time” is needed to support it. There is no recovery.
But the governor believes that credit default should not be “permanent” because “it is negative.” He pointed out: “We cannot insist on the idea of making the credit suspension process permanent.”
He recalled that the Bank of Portugal carried out activities in the context of the European financial system, and recalled that in other countries, the effectiveness of credit defaults had been determined.
Centeno recalled that at this time “, “we have observed that more than 12% of companies have their default credits withdrawn.” “There are 3 billion euros, plus the euro minus the euro, and it is up to the company that no longer defaults. Company”, and because some suspension periods are coming to an end.