"Interest never shrink debt to pre-crisis levels," says ... - Digital Diary

“We have to recognize that the level of interest rates on the public debt is still too high, but we have to get used to the idea that even if the adjustment program to be successful, we will live in the future with a level of fees and cost of financing in excess of what we had before the crisis. We will not have ‘spreads’ of 10 ‘basis points’ in relation to German interest rates, “warned José de Matos during the conference” Business in Box , “which took place today in Porto.

“We have a risk premium still excessive, but will not come to the levels we had before the crisis,” he added.

Speaking at the conference, organized by CGD in partnership with the group Controlinveste, José de Matos pointed to “negative evolution of employment” with being “by far” the “main problem” in the country.

In this regard, highlighted the issue of youth unemployment, “probably the most qualified of many generations” and “a waste of resources absolutely unacceptable.”

“All, companies and banks, we do our best to get reverse this situation and be able to avoid this waste of resources that is absolutely criminal,” contended.

Relatively recent developments in the credit market, the president of CGD showed “some relief from easing of lending criteria in recent quarters”: “On the supply side credit things have improved and this is true for small and large companies. There is much competition at the moment, the best in banking risk, which is an excellent sign, “considered.

From the point of view of the demand for credit, José de Matos anticipated that “private loans will continue to fall,” while credit to companies reveals “signs that it is recovering,” especially in the exporting companies.

“There are some more encouraging signs of some recovery in investment returns and there are indicators of business activity that, in spite of being recent, is positive,” he said.

this context, the strategy of CGD undergoes a “reorientation of the loan portfolio” of individuals to companies, “particularly for small and medium enterprises that have a more direct and immediate impact on employment levels.”

Asked by Lusa on the imposition of the Bank of Portugal to the bank for a reassessment of the property in its portfolio, José de Matos said that “CGD has a very prudent action in this matter and make a reassessment of its usual and regular estate “.

“Certainly we’re looking at these recent regulatory standards,” but “I hope you do not have a significant impact [on the impairment of the bank],” he maintained.