(Adds detail, background on subordinated debt, lawyer comment)
By Laura Noonan and Andrei Khalip
LISBON, Aug 12 (Reuters) - The healthy bank carved out of Portugal's heavily indebted Banco Espirito Santo will assume BES's 3 billion euros credit line to a troubled Angolan subsidiary but take provisions for losing the entire amount, the Bank of Portugal said on Tuesday.
Novo Banco was created to take on the healthier assets of one of Portugal's largest banks, leaving behind the original bank's shareholders, junior creditors and loans linked to companies of the Espirito Santo founding family which are under investigation for financial irregularities.
In a statement to Reuters, Bank of Portugal said Novo Banco would take on the interbank loans granted to BES's troubled Angolan subsidiary but that the credit line had been "fully provisioned".
"The total provisioning for these credits is only a measure of caution and does not reflect, in any way, a lack of expectations of recovering the loans," the Bank of Portugal added in the statement.
Taking on the loans, while providing for 100 percent losses on them, means that any money recouped from BES Angola will count as profit for Novo Banco.
BES' junior creditors - who are owed about 1.5 billion euros - were hoping that the Angolan loans would not be moved to Novo Banco, since if they stayed with the bad bank then creditors would have a greater chance of being repaid if some funds are eventually recovered from Angola.
The Angolan subsidiary is burdened with bad debt after expanding its loan book rapidly then bumping into economic conditions that hurt its customers. Angola's government initially guaranteed 70 percent of its debt but revoked that promise last week. Now the National Bank of Angola has appointed provisional administrators to oversee "extraordinary overhaul measures" at the unit, which is 56 percent owned by BES.
Some BES creditors say they would have fared better if the bank had been liquidated, and the New York Times reported on Aug. 8 that several of them are considering legal action against the structure of the rescue.
Nuno Líbano Monteiro, partner at Portuguese legal firm PLMJ, told Reuters that Portuguese law on rescuing banks requires that "no creditors of the credit institution may suffer a loss greater than the one they would have suffered if the institution had gone into liquidation".
The Bank of Portugal said the rescue of BES had followed that principle. The detail of the rescue means that if the new bank is ultimately sold for more than the cost of its bailout, the extra will go back to the bad bank. Market sources say they do not expect a sale until 2015, at the earliest. (Reporting By Laura Noonan and Andrei Khalip; Editing by Sophie Walker)