, Columnist
Portugal's Problematic Bank
Bondholder happiness over smaller capital hole may be short-lived
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Novo Banco's bondholders received a pleasant surprise as European regulators said the bailed-out Portuguese lender had a smaller-than-expected capital hole. The bonds rallied from all-time lows, but people shouldn't be getting too ahead of themselves.
The lender -- once part of the country's Banco Espirito Santo empire -- will try to plug the shortfall by selling assets and getting a capital injection from an outside buyer. So far it hasn't set out details of what assets would go, while it failed in its first attempt to attract an outside buyer.