LISBON Feb 3 Portugal's parliament rejected on
Friday proposals by the government's far left allies to halt the
sale of rescued lender Novo Banco and nationalise it instead.
The ruling Socialists and centre-right opposition parties
voted against the proposals by the Communists and Left Bloc, but
the Socialists said nationalisation might be a last resort if
all attempts to sell the bank failed.
Last month, the central bank picked U.S. private equity firm
Lone Star to conduct further negotiations on the sale of the
bank, which was carved out of collapsed Banco Espirito Santo
(BES) in 2014.
"After two years ... it's clear that the sale process is
difficult," senior Socialist lawmaker Joao Galamba said.
"The Socialist party does not see the nationalisation as
absolute evil. It sees it as a possible solution, but only if
the sale fails ... We believe that letting the negotiations run
to the very end is what best protects the interests of the state
and taxpayers," he said.
The Left Bloc and Communists are allied with the Socialist
government and support rolling back austerity after Portugal's
debt crisis. But they maintain some independent positions, such
as bank nationalisations and debt renegotiation.
The first attempt to sell Novo Banco, which in 2014 received
an injection of 3.9 billion euros in public funds, failed in
2015. Portugal had hoped to find a buyer by the end of last year
in the second, current attempt, but has agreed a final sale
deadline of August 2017.
Finance Minister Mario Centeno told Reuters last month that
no option, including nationalisation, was ruled out, but
anything other than a sale would have to be discussed with
(Reporting By Sergio Goncalves and Andrei Khalip, editing by
Axel Bugge, Larry King)