LISBON, Feb 9 (Reuters) - Portugal’s largest listed bank Millennium bcp wants the government to extend the loan repayments freeze for pandemic-hit tourism companies beyond September if the health crisis has not been overcome by then, Chief Executive Officer Miguel Maya said.
He told a webinar on saving Portugal’s vital tourism industry on Tuesday that “requiring the repayment of loans at a time when companies have no income - as a result of a market failure due to the pandemic - does not make any sense”.
“Millennium bcp will continue to defend the extension of (loan repayment) moratoriums for the tourism sector as long as the pandemic situation is not controlled, not only for companies, but also for workers”, he said.
Portugal’s banks have suspended capital and interest repayments on 46 billion euros of corporate and household debt to avoid a jump in bad loans, according to latest Bank of Portugal data up to the end of September.
The freeze will be lifted on around a quarter of affected loans in March - mostly consumer loans, mortgages and some corporate loans - but will continue for the rest until September.
Tourism was crucial for Portugal’s recovery from the 2010 economic and debt crisis and in 2019 reached about 15% of Portugal’s gross domestic product.
Since the first quarter of 2020, lockdowns and travel restrictions in Portugal and elsewhere have practically paralysed the entire sector.
“It is necessary to preserve the capacities of the sector even to ensure that, once the health crisis is resolved, the recovery can take place at an accelerated pace,” Maya said. (Reporting by Sergio Goncalves, Editing by Andrei Khalip and Alison Williams)