“Sorry… I can’t remember”: Governor of Bank of Portugal suffers memory lapses over ‘ruinous loans’

It has proved another ‘difficult week’ for Carlos Costa – Portugal’s top man at the central bank.

Quizzed over the details of some of the more ruinous loans sanctioned by State Bank CGD when he was on the board, Costa “resorted at least 10 times to the argument of lack of memory”, writes tabloid Correio da Manhã.

That the man ridiculed by left-wingers as akin to Disney’s Mr Magoo – a myopic, inept and doddery old codger – cannot actually remember key moments of his professional past has not gone down well in parliament, nor particularly in the press.

Observador has given a detailed account of what took place as MPs “confronted Carlos Costa with his responsibilities at the Caixa”, concluding that answers, when they came, simply compounded the confusion that already exists in everyone’s minds over how a State Bank could have lost so many hundreds of millions with people like him at the helm.

Said the top man, there was never any “intention” by him “to reduce the importance or the gravity of the losses at CGD during years (that have since been the subject of a damning external audit by Ernst & Young: click here), there was “simply the clear intention to distinguish between what is important, the decision over which is substantial, or what is simply a problem of formal procedure. This could end up concealing the most important question particularly because the question of formal procedure depends on an interpretation of internal rules that was continued over time…”

Correio da Manhã’s journalists may have missed these explanations: their story today centres much more on Costa’s memory lapses, and answers like: “I didn’t take part in decisions”, “I have no memory 14 years after a matter has been discussed…”

It appears Costa has also forgotten loans for two motorways in Spain “while he was responsible for the bank in that country”.

The loans resulted in debts of €38 million and €20 million respectively, and yes, he can’t remember having “participated in the wider commission related to the operation”.

Where this will all end up is unclear. But to give Carlos Costa some credit (excuse the pun), he has been up against it since the government came into office (click here) – and no amount of criticism appears to have affected his tenure at the country’s central bank.

Next year, as a matter of course, his two-term (decade-long) mandate will come to an end marking a 10-year period in which more banks have failed than most people can remember.

natasha.donn@algarveresident.com