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Portugal Said to Have Opposed Central Bank Over Novo Banco

  • Felix told investors that concerns were expressed, people say
  • Bond prices tumbled after debt was shifted to bad bank
Updated on

The Portuguese government said it was against the central bank’s decision to impose losses on some Novo Banco SA bondholders, according to two people familiar with the situation.

Finance Secretary of State Ricardo Mourinho Felix told investors on Monday that the ministry had expressed concern to the central bank about the transfer of bonds to a bad bank, said the people, who asked not to be identified because the discussions were private. Pacific Investment Management Co. and BlackRock Inc., the biggest holders of the debt, were among investors at the event in London, people said.