The government is to "analyse" whether or not to instruct Santa Casa Misericórdia de Lisboa to abort its highly contentious investment in Montepio Bank (Caixa Económica Montepio Geral).MPs have demanded that the Government use its powers to cancel the deal between the cash-rich charity and the struggling bank, claiming pressure has been put on the charity to release funds to help shore up the bank’s capital.
The Government says it will "analyse" the deal that has been approved by parliament but will say no more at this stage.
In an undeniable conflict of interests that seems to bother few, José Vieira da Silva is a trustee of Santa Casa da Misericórdia in Lisbon and also of Montepio Geral - Associação Mutualista, the company that owns the bank. Da Silva has been involved in a deal to invest up to €200 million of charitable funds in the bank.
At the moment, the intention is to invest €18 million for 1% of the bank’s capital. Currently, the mutual association is the sole shareholder of the financial institution. Further investments are likely to be made despite their speculative nature.
There are two draft resolutions; to scupper the investment and to place limits on the autonomy of Santa Casa of Lisbon with respect to its investments. Both have been approved in parliament and it is these that will be 'looked at closely' by the government.
There are two draft resolutions; to scupper the investment and to place limits on the autonomy of Santa Casa of Lisbon with respect to its investments. Both have been approved in parliament and it is these that will be 'looked at closely' by the government.
In early April, Santa Casa’s Edmundo Martinho said at a parliamentary hearing, "We are very determined to be part of a process that contributes to consolidate the social economy."
Martinho stressed that the investment in Santa Casa, currently owned by Montepio Geral - Associação Mutualista, aims to create "a strong financial entity," that would ensure that there will be no repercussions on the activity of Santa Casa, even though he knows this is impossible.
"There is no risk-free investment, it's true," admitted Martinho, adding that the deal had been studied with caution.
Martinho stressed that the investment in Santa Casa, currently owned by Montepio Geral - Associação Mutualista, aims to create "a strong financial entity," that would ensure that there will be no repercussions on the activity of Santa Casa, even though he knows this is impossible.
"There is no risk-free investment, it's true," admitted Martinho, adding that the deal had been studied with caution.
Edmundo Martinho also has stated that this "business is not a subsidy, it's not a support, it's an investment."
"It is from this point of view that we understand it and it is with this logic that we will move forward," he said, stressing that this "intervention of a financial nature will be for a very low percentage of Santa Casa’s assets," and that the deal does not affect any of the huge investments that are planned for the city of Lisbon.
The Social Democratic Party, which called the April 4th hearing, already has warned that it does not want the deal to go through, "The PSD will do everything to obstruct Santa Case in this deal,” said Adão Silva.
To make things even less comfortable, Santa Casa is working on the investment with Haitong Bank which still suffers from its association with Espírito Santo family member, José Maria Ricciardi whom it had to 'let go’ in early 2017.
The Social Democratic Party, which called the April 4th hearing, already has warned that it does not want the deal to go through, "The PSD will do everything to obstruct Santa Case in this deal,” said Adão Silva.
To make things even less comfortable, Santa Casa is working on the investment with Haitong Bank which still suffers from its association with Espírito Santo family member, José Maria Ricciardi whom it had to 'let go’ in early 2017.
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Santa Casa de Misericórdia is a Portuguese charity founded in Lisbon in 1498 by Queen Leonor of Portugal. It declares itself to be a Catholic lay brotherhood and to work through 14 Works of Mercy, seven of a spiritual nature: to teach the humble, to give good advice, to punish those who do wrong, to console the sad, to pardon offenses, to suffer patiently, to pray for the living and for the deceased; and seven of a corporeal nature: to visit the ill and imprisoned, to free captives, to clothe the naked, to feed the hungry and thirsty, to shelter travelers and to bury the dead.
Montepio, formerly Montepio Geral, is a Portuguese mutual savings organisation, better known for its banking activity. Montepio was established in 1840, with its headquarters in Lisbon.
