Portugal | Bruegel

Blog Post

Is the ECB collateral framework compromising the safe-asset status of euro-area sovereign bonds?

Central banks’ collateral frameworks play an important role in defining what is considered as a safe asset. However, the ECB’s framework is unsatisfactory because it is overly reliant on pro-cyclical ratings from credit rating agencies, and because the differences in haircuts between the different ECB credit quality steps are not sufficiently gradual. In this note, the authors propose how the ECB could solve these problems and improve its collateral framework to protect its balance sheet without putting at risk the safe status of sovereign bonds of the euro area.

By: Grégory Claeys and Inês Goncalves Raposo Topic: Macroeconomic policy Date: June 8, 2018

Opinion

Portugal in a new context of capital flows

The euro area is now the world’s largest exporter of capital. Here we look at the post-crisis transition of one euro-area country – Portugal – from net recipient to net provider of capital, in the context of the European Commission’s plans for deeper capital markets.

By: Inês Goncalves Raposo and Bruegel Topic: Banking and capital markets Date: February 20, 2018

Blog Post

The IMF’s performance on financial sector aspects of the euro area crisis

The recently published in-depth evaluation of the International Monetary Fund (IMF)’s role in the euro area crisis highlights important contrasts in the area of financial services. The IMF provided highly valuable analysis and recommendations to the EU on its banking sector and related policies. In individual countries (leaving aside Cyprus and the second Greek programme, not covered by this evaluation), the financial-sector aspects of the IMF’s interventions were highly successful in Ireland and Spain, ambiguous in Greece, and a missed opportunity in Portugal.

By: Nicolas Véron and Bruegel Topic: Banking and capital markets Date: August 29, 2016

Policy Contribution

The IMF’s role in the euro-area crisis: financial sector aspects

Nicolas Véron reviews in-depth the role played by the IMF in understanding the financial-sector dynamics of the euro-area crisis. The IMF was the first public authority to acknowledge the role of the bank-sovereign vicious circle and to articulate a clear vision of banking union as an essential policy response. At national level, the IMF’s approach to the financial sector was appropriate and successful in Ireland and Spain, more limited in the Greek Stand-By Arrangement, and less compelling in Portugal.

By: Nicolas Véron and Bruegel Topic: Banking and capital markets Date: August 29, 2016

Blog Post

Deferred tax credits may soon become deferred troubles for some European banks

The EU Commission is reportedly collecting evidence on the use of so-called deferred tax credits (DTCs) in banks in Greece, Portugal, Spain and Italy, to see whether some recent regulatory changes and recognition practices constitute hidden state aid. Here I review what these instruments are, and why the issue is important. Legislation enabling DTAs to be transformed into deferred tax […]

By: Silvia Merler Topic: Macroeconomic policy Date: April 9, 2015