Portuguese banking: The party is over
Portuguese banks were the golden boys of European finance for years, reaping the rewards of a consumer lending boom. But Portugal has landed with a bump, with GDP growth no longer outstripping the rest of Europe. The banks are suffering, both in wholesale finance and in retail, where intense competition makes it difficult to turn a profit. Even market leader Banco Comercial Português is feeling the pinch. With opportunities for domestic mergers limited, it has expanded abroad, with mixed results.
It doesn't take long for a rumour to spread in a city as small as Lisbon. At the moment, most of the rumours in the banking sector are about Banco Comercial Português.
Established as recently as 1985, the bank is a success story that has won the envy and respect of its rivals and international commentators. Established under chairman and CEO Jorge Jardim Gonçalves, BCP has established a domination in both retail and wholesale finance. And analysts still highlight it as a good bet for investors in Portuguese banking.