LISBON, July 13 The Bank of Portugal accelerated
management changes at Banco Espirito Santo on Sunday in
a further sign that regulators want the bank to be distanced
from the financial woes of the bank's founding family.
The Bank of Portugal said in a statement that it had ordered
BES, Portugal's largest listed bank by assets, to hold a meeting
of its advisory board to immediately put in place new executives
who were originally supposed to take over at the end of July.
BES has been hit in recent weeks by fears that a "serious
financial condition" at one of its founding family's holding
company's - Espirito Santo International - could undermine its
The worries over BES sent shockwaves through financial
markets beyond Portugal last week. The bank has said it has
enough capital to meet any potential capital shortfalls
resulting from its exposure to Espirito Santo family companies.
The Bank of Portugal said it wanted the management changes
to take place "following the resignations presented by members
of the management board of BES".
The Espirito Santo family patriarch, Ricardo Espirito Santo
Salgado, announced his resignation as chief executive of BES
last month. But his departure, along with other members of the
family on the bank's board, was only due to take effect after a
meeting of the bank's shareholders on July 31.
The head of BES's investment banking unit, Jose Maria
Ricciardi, said on Sunday the change in BES's management needed
to take place as soon as possible.
"I think it's indispensable for the confidence of clients,
staff and the general public that the executive commission of
BES be substituted as soon as possible by the new team that is
supported by the main shareholders and the Bank of Portugal," he
said in a statement sent to Reuters.
"This decision is part of the position that I have taken for
more than a year, of denouncing practices internally and to
regulators with the aim of changing governance at BES and at the
Espirito Santo Group," he said.
The Espirito Santo family has named respected economist
Vitor Bento to be the new chief executive of the bank and Joao
de Almada Moreira Rato, who heads Portugal's IGCP debt agency,
to be the chief financial officer.
The Bank of Portugal said the new executives still needed to
be confirmed at the July 31 shareholders' meeting.
(Reporting By Axel Bugge; Editing by Kevin Liffey)