The Bank of Portugal has stuck to a decision to keep a loan linked to Goldman Sachs in a 'bad bank' carved out after the rescue of Banco Espirito Santo (BES), putting the central bank and Goldman on course for a legal battle.
Goldman Sachs loaned Portugal’s Banco Espirito Santo SA $835 million in July, just weeks before the group’s units sought creditor protection in a cascade of insolvencies that resulted in the lender’s bailout.
Credit Agricole said profit was almost wiped out in the second quarter on charges tied to its stake in bailed-out Banco Espirito Santo SA.
The $6.6 billion bailout of Portugal's largest bank poses a warning for other European banks which are heavily exposed to "fragile" emerging market economies in Latin America and Africa, analysts have cautioned.
The drama at Portuguese lender Banco Espirito Santo (BES) resumed on Thursday with a former CEO of the bank being held by police in Lisbon.