The amount of bad loans in Portuguese banks increased in February for the second consecutive month, reaching 17.984 billion euros, or 10 percent of the country’s gross domestic product (GDP), according to the Bank of Portugal.
The gross domestic product of Portugal at the end of 2015 was estimated at 179.3789 billion euros, according to the National Accounts published by the National Statistics Institute (INE).
The value of loans overdue for over 90 days in the banks’ portfolios in the month under review is the second highest since November 2014, when it reached 18.883 billion euros.
Most of the bad debt was contracted by companies, which account for 12.9 billion in defaulted loans and the remaining 5.1 billion euros are related to private loans.
Recently, the Prime Minister of Portugal called for the creation of a “resolution vehicle” for loans overdue by more than 90 days in order to “free the financial system of a burden that hinders more active participation in the financing of companies.” (macauhub/PT)