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Portuguese investors demand recovery of bank bond funds or boycott European funds – EURACTIV.com

A group of international institutional investors coordinated by the Attestor Capital fund were tracked down in the Banco Espírito Santo case for 2 billion euros, hoping that the European Commission would resolve the case, and warned that otherwise, they would not fund the post-pandemic economic recovery .

“It is vital that the law is respected in the member states and has no political influence. We want to understand what is happening and be compensated for what we have lost,” the investor said in a statement, demanding that “in Before considering part of the funding for the European Union Recovery Fund, ensure remedies and fair treatment.”

According to the source of eight investors (known as “Resume Portugal”), “At present, the focus of legal action is on BdP [Bank of Portugal]However, “if this matter is not resolved, they will undoubtedly be forced to take legal action against the European Commission.”

In a video posted online, the group of institutionalists who invested in the bonds of the former Bank of San Espirito (BES) claimed to convey “good news and bad news” to Europe.

They said: “The good news is that the European Union will allocate 750 billion euros to member states through the European Recovery Fund to help them recover from the crisis triggered by COVID-19.”

“The bad news is that the EU must borrow money before allocating this money. This may be a problem because international investors are very dissatisfied with the EU and Portugal,” they pointed out.

The organization warned that if the EU wants to obtain these 750 billion euros from international investors, it “must first show them that it will treat them fairly and justly by solving the BES issue first.”

While Portugal is “in the world’s attention” for its presidency of the European Council, the “restoration of Portugal” calls into question the country’s ability to manage upcoming EU funds and its legal system that “doesn’t work in this case”. It dragged on for six years.

The problem is that the Bank of Portugal made a decision at the end of 2015 to re-transfer the responsibilities of the Bank of Portugal’s 5 senior bonds in the face of the capital needs of Novo Banco (the “good bank” generated during the BES resolution process). BES-transferred to Novo Banco at the time of the August 2014 resolution measures-returned to the “bad bank” that retains toxic assets.

In a statement issued at the time, BdP explained that this measure “needs to ensure that BES losses are first absorbed by the institution’s shareholders and creditors, and not by the banking system or taxpayers”.

The regulator then added that “the selection of these issues is based on public interest reasons to maintain financial stability and ensure compliance with the objectives of the resolution measures applicable to BES”, and to protect “all depositors, creditors’ services and other types of ordinary services”. creditor”.

However, the institutional investors holding these bonds accused the BdP of nationality discrimination, claiming that the five lines chosen by the regulator were “held by foreign investors, not Portuguese” and “the only ones governed by Portuguese law rather than international law” “.

“We hope to recover the more than 2 billion euros taken from us. Investor interests must be protected and we must ask the Portuguese government to resolve the new bank issue as soon as possible. This is what many investors are waiting for,” said’Resume Portugal’.

Reiterate their “continuous attention to the situation in Portugal” and “ultimate suitability and capability [of the country] In order to manage such a large amount of funds from the European Recovery Fund”, this group of aggrieved investors believes that “the BES case puts Portugal at the center of the controversy.”

“As a candidate for a 45 billion euro grant from the next-generation EU fund worth more than 4% of its GDP in the next few years, it still raises serious questions about the seriousness of the country’s judicial system,” they said.

They pointed out that the European Commission “has found that the Portuguese Administrative and Tax Court’s cases are lengthy and prolonged, and called on the country to implement its recommendations to improve the efficiency of the Administrative and Tax Court, that is, to shorten the litigation time.

“They want to invest in the digitization of the judicial system to speed up the resolution of cases and improve the level of technology. It is a good thing, but we need to resolve cases that have been blocked for political reasons. Unfortunately, this is not suitable for the EU,” said “Resume Portugal”.

The organization emphasized that “it is important for the European Commission and all members to exert pressure on these pending cases”, and believes that “investors have been expropriated and no solution to date is unacceptable”.

“The restoration of Portugal requires respect for the rule of law of the member states,” it concluded.

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