Portugal’s Biggest Banks Increase Holdings in Country’s Debt

Portugal’s three biggest publicly traded banks’ combined holdings of their country’s sovereign debt rose 6.2 percent in the third quarter from the previous three months.

The total expanded to 17.2 billion euros ($23.2 billion) from 16.2 billion euros at the end of June, according to filings by the lenders.

Portuguese banks increased the amount of the nation’s debt they held as foreign investors trimmed theirs. The country’s bonds were the worst performers in the euro region in the third quarter as a rift in the government threatened to derail plans to avoid a second bailout package. Domestic banks held a record 34 billion euros of the debt on Sept. 30, according to European Central Bank data.

Banco Espirito Santo SA, Portugal’s biggest publicly traded bank by market value, owned 5.3 billion euros in Portuguese debt, including 1.8 billion euros in debt maturing in a year or less, the Lisbon-based bank said a week ago. That’s more than the 4.4 billion euros held in June. The company also holds Spanish, Italian and Greek sovereign debt, mostly in shorter maturities.

Banco Comercial Portugues SA, the country’s second-biggest listed bank by market value, held 6.8 billion euros of Portugal’s debt, of which 3.9 billion euros were bonds, the Oporto-based lender said yesterday in a filing. That’s more than the 6.55 billion euros owned at the end of June. The bank also holds Polish, Mozambican, Angolan and Romanian debt.

Banco BPI SA, the third-biggest publicly traded bank, had

5.1 billion euros of the debt at the end of September, of which

3.5 billion euros was in treasury bills, the Oporto-based bank said last week. That’s little changed from the 5.2 billion euros held at the end of June. The bank also owns Italian and Irish debt.

Before it's here, it's on the Bloomberg Terminal.