A new banking code will pave the way for Portugal’s banking supervisor, the Bank of Portugal, to force the country’s largest banks to sell their positions if the institution is in financial risk.
In other words, the New Banking Activity Code will force majority shareholders to sell their shares to help shore up banks in financial difficulty.
The same would also apply if there was evidence of suspected money laundering in compliance with the draft New Banking Activity Code which is currently going through its public consultation phase.
The new banking code, which will replace the General Regime for Credit Institutions and Financial Companies (RGICSF), will allow the supervisor to decide on the sale of part or all of the shares of the respective holders who have a qualified major share in the bank in situations deemed to be a risk for the stability of that bank.
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