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By Laura Noonan
LISBON, July 24 (Reuters) - The biggest shareholder of Banco Espirito Santo sought creditor protection on Thursday, putting an immediate stay on more than 1.5 billion euros ($2 billion) in claims and raising uncertainty about the bank's future ownership.
Espirito Santo Financial Group is the third Espirito Santo family company to seek protection in less than a week, as problems escalate for the prominent Portuguese family since accounting irregularities were identified in one of its holdings earlier this year.
The ESFG filing could have the most profound impact yet for the prized asset of the family network, Portugal's largest listed bank.
ESFG is the largest shareholder of BES, with a 20 percent stake. It has also borrowed more than 800 million euros from BES, which was founded by the family in the 19th century.
ESFG also set aside 700 million euros last year to make sure that commercial paper issued by family companies and placed with retail clients of the bank would be repaid. It is unclear whether that provision would now be at risk.
Portuguese authorities have been trying to draw a distinction between the financial problems at the family businesses - holding companies with interests in tourism, health and real estate - and any repercussions for BES, which has said it is covered for any losses from exposure to the family holdings.
On Thursday, a bank spokesman said the lender had no comment on the ESFG filing.
In a statement, ESFG said it had applied for controlled management because it was unable to meet the obligations of its commercial paper programme - a form of short-term borrowing - and other debts.
ESFG had unsecured external debt of 830.2 million euros at the end of June and also had guaranteed 470 million euros borrowed by two subsidiaries, according to a statement released by BES on July 3.
Ciaran Callaghan of Dublin-based Merrion Stockbrokers said that when BES releases its results next week it is expected to take previsions for its exposure to family holdings.
"ESFG debt has been pricing in some type of default," he added, pointing out that ESFG has yet to unveil a planned restructuring plan.
Luxembourg law allows controlled management for companies unable to meet their obligations due to temporary financial difficulties, and in circumstances where controlled management would help them get the most value from their assets.
Earlier on Thursday, Reuters reported that some owners of ESFG bonds had been told that they could not use their option to convert the bonds into BES shares at this time.
After its BES stake, ESFG's next most important asset is Portuguese insurer Tranquilidade, which had a book value of 515 million euros at the end of last year.
Fears about the bank's links to the Espirito Santo family group wiped more than 50 percent off BES's market value in the last month, after the family's empire ran into problems.
The situation was made public in late May after a central bank-ordered audit uncovered material accounting irregularities at one of the family's main entities. ($1 = 0.7426 Euros) (Reporting By Laura Noonan; Editing by Alessandra Galloni and Jane Baird)