The last days of Ricardo Salgado and Banco Espírito Santo

Bankers in Lisbon say the demise of BES is a watershed moment for the country: the turning point when old Portugal became new Europe. When BES collapsed earlier this year, markets briefly feared a return of the crisis to Portugal and to Europe. Even after the bank's bailout, investigators in at least six countries still pore over bank documents, transfers and deals, trying to make sense of Salgado’s last days battling to keep his empire afloat. The backstory is of an extraordinary rivalry, spanning the decades before and after Portugal's 1974 revolution, between the country's two pre-eminent business families.

Pedro Queiroz Pereira was lawyered up, hurling legal volleys at Salgado by dusting off his clan’s long-standing position as a shareholder in the Espírito Santo entities

The credibility of the Banco de Portugal and its governor Carlos Costa has been called into question over the collapse of BES. But a source close to the central bank says: "Our solution was well received in the political arena, and amongst our international peers and by Portuguese bankers. To have a public backstop is not luck"

They were valuing (the assets) using discounted cash flow, which gives a different value about, let’s say, 10 times the actual value of the market price. He wanted me to write a paper saying that not only was this possible but that it was appropriate  Professor Joao Duque

You couldn’t make it up. Yet investigators across the world are trying to determine if making it up is exactly what Banco Espírito Santo’s Ricardo Salgado did in Lisbon. 

Read this month's cover story, Downfall of a dynasty: The last days of Ricardo Salgado and Banco Espírito Santo, to decide for yourself.