You are here

Clarification on the methodological treatment of the BANIF resolution and the respective impact on the statistics compiled by the Banco de Portugal

The public debt figure for 2015 compiled by Banco de Portugal and included in the excessive deficit procedure notification stood at 231 billion euro (128.8 percent of GDP). This amount corresponds to the information published by the Banco de Portugal on February 1st, 2016 and disclosed in the respective Statistical press release. As mentioned in that press release, the Banif resolution operation had an impact on public debt through the inclusion of the debt securities issued by Oitante (746 million euro), an entity created in this context.
Taking into account the relevant methodological framework for the compilation of statistics of its responsibility, Banco de Portugal considers that Oitante should be classified in the general government sector, while BANIF S.A. (the residual entity resulting of the resolution of BANIF) should be classified in the financial sector, for the following reasons:

    a. BANIF is included in the European Central Bank list of monetary financial institutions. According to the European System of National and Regional Accounts, on which the compilation of public debt is based, «Monetary financial institutions (MFIs) as defined by the ECB consist of all institutional units included in the central bank (S.121), deposit-taking corporations except the central bank (S.122) and MMF (S.123) subsectors»
    b. This classification is in line with the Opinion [1], published in September 2015 by the CMFB - Committee on Monetary, Financial and Balance of Payments Statistic [2], on the classification of entities under resolution. According to the classification rules included in this Opinion, BANIF S.A., as an authorized credit institution and as an entity not controlled by the general government, should be classified in the financial sector. This Opinion was issued with the aim of achieving consistency across the various statistical domains and across countries, and of ensuring that the economic substance of transactions is duly taken into account.

    c. The institutional sector of general government only includes entities controlled by government institutions, and this is not the case of BANIF S.A..

Additionally, regardless of the classification of BANIF SA in the financial sector or in the general government, Banco de Portugal considers that its liabilities (amounting to EUR 295 million or 0.16% of GDP) should not be reflected in public debt as its repayment will be decided in the context of the liquidation of that entity and hence does not constitute a liability of the State.

In conclusion, Banco de Portugal considers that BANIF S.A. is still a financial sector unit and that its liabilities, not being a responsibility of the Portuguese State, should not be included in public debt. Banco de Portugal is still committed in proceeding with the in-depth methodological analysis of this issue, involving the National and European Statistical Authorities with the above mentioned objective achieving a level playing field across countries and various statistics.
Lisbon, 31 March 2016

[1] See CMFB opinion of the statistical classification of entities under resolution.
[2] According to the Council Decision establishing the Committee on monetary, financial and balance of payments statistics (2006/8568EC), this Committee may express opinions on its own initiative on any questions relating to those statistics that are of common concern to the Commission and national statistical authorities, on the one hand, and the European Central Bank and national central banks, on the other.