The European Central Bank’s financing to Portuguese lenders rose to a new record in May, the Bank of Portugal said.
ECB financing increased to 58.7 billion euros ($73.6 billion) from 55.4 billion euros in April, the Lisbon-based Bank of Portugal said today on the BPStat portion of its website. ECB financing levels had previously peaked at 56.3 billion euros in March.
In April last year, Portugal became the third euro-area country after Greece and Ireland to require aid and will receive 78 billion euros under its agreement with the International Monetary Fund and the European Union. The plan earmarks 12 billion euros for Portugal’s lenders, if needed.
Spain on June 9 became the fourth euro member to seek a bailout since the start of the region’s debt crisis more than two years ago with a request for as much as 100 billion euros in loans to rescue its banking system.
The Portuguese government announced on June 4 that it has committed to inject more than 6.6 billion euros in Banco Comercial Portugues SA (BCP), Banco BPI SA (BPI) and state-owned Caixa Geral de Depositos SA to recapitalize the lenders.
As part of the Portugal’s aid plan, the country’s lenders were required to raise core Tier 1 capital ratios to 9 percent by the end of 2011 and 10 percent by the end of 2012. In addition, the EU banking regulator ordered the region’s banks to have a 9 percent capital ratio by the end of June after marking down their holdings of sovereign debt to market prices.
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