Portugal fears lock banks out of debt markets

05 Nov 2010

Country risk fears are likely to lock Portuguese banks out of the debt markets in the short term in spite of broadly positive third quarter results and this week’s parliamentary approval of the 2011 budget, said bankers. With Portuguese CDS continuing to widen, economic worries mean that banks would struggle to launch primary deals until conditions improve.

"The problem is not Portuguese companies or banks," said a DCM banker in Lisbon. "Investors are concerned about the country itself. It’s a country risk issue."

Banks are certainly keen to issue. Banco Comercial Português and Caixa Geral de Depósitos have both met debt investors recently, and Banco Espírito ...

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