Banks will now have to create reserve capital for loans to private clients secured by real estate intended for residential use, the Bank of Portugal said on Wednesday.
This systemic risk reserve, which, as the banking regulator emphasizes, is of a preventive nature, amounts to 4% and applies to a portfolio of loans to individuals guaranteed by residential real estate located in Portugal.
Banks will be required to prepare such a financial cushion from 1 October 2024, with this measure to be reviewed every two years and covering banks BCP, BPI, Santander and Novo Banco (those that use the IRB methodology, which assesses customers’ ability to repay the loan jar).
Author: Lusa
Source: CM Jornal
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