There are moments that we wait for decades. This Tuesday morning, almost 1,700 affected people attended the start of the trial that aims to determine who is responsible for the bankruptcy of what was the largest private bank in Portugal. For those who lost their life savings with the bankruptcy of Banco Espírito Santo (BES), justice was too slow, but on Tuesday the trial began that put on the bench someone who for decades was considered one of the most powerful of the country, Ricardo Salgado.
To realize the size of the Espírito Santo Group, owner of the bank of the same name, and the influence that the president of the entity, Ricardo Salgado, had, just look at the name by which the former banker was known in Portugal: “Owner of all this.”
BES’s network of interests extended to political power, since the leader of the bank frequently received politicians in his office, with whom he exchanged favors or maintained a cordial relationship to ensure that he remained influential in the event of a change in the political cycle. The BES group was also known for its heavy investment in the real estate sector, with a huge portfolio of properties and investments, and for its strong ties with the business community – BES had a client and asset portfolio that was unmatched by other private banks. that operated in Portugal.
Far from the power that he held for decades, the Ricardo Salgado who reappeared before the country this Tuesday is a weakened man and far from the image of “owner of everything” that he has nurtured since he took charge of Banco Espírito Santo in 1991. After years in which he was rarely seen in public, Salgado is coping – according to the defense – with Alzheimer’s disease. On his first day in court, he was only able to answer when asked his name. All other questions remained unanswered.
The great battle of the former banker’s defense in recent years has been to request the suspension of the process due to the advanced state of his illness, which would make him unable to defend himself against the 62 crimes of which he is accused – including fraud, corruption and falsehood. documentary. Salgado’s defense did not achieve its objective and the trial began without anyone being able to specify how long it will last, given the enormous scope of the case.
To show the country the state of health of Salgado – who is now 80 years old -, the defense purposely left the former banker at the doors of the Lisbon Justice Campus, where the trial is being held, so that the banker could make the short film. 30 meter journey to the entrance of the court in front of the cameras of the different television channels concentrated there. The walk was too slow for the few meters I had to travel and was impossible without support. Upon leaving the courthouse, Salgado ended up leaving by car from the garage. Once identified, unable to answer the most basic questions due to his state of dementia, he was excused from appearing for the rest of the trial.
A total of 18 defendants sit in the dock – three of them companies – who have committed more than 300 crimes. Some of these crimes have prescribed due to the delay in the trial. The case has more than 89,000 pages, organized into 215 volumes. All of the defendants decided to remain silent on Tuesday.
More than a hundred victims died without recovering their money
In one of the last advertisements that the popular soccer player Cristiano Ronaldo made for the bank – in 2010, already in the midst of a crisis whose magnitude was publicly unknown – he made a famous statement: “I don’t like to lose a cent, that’s why my money It is in BES.” The bank that seemed safe was not. Since 2008, accounts have been falsified to hide liabilities, in successive loans within the subcompanies of the business group, using a series of financial mechanisms to hide the real situation of the bank. While before the crisis the liabilities amounted to 180 million euros, when the economic group went bankrupt, the bank had more than 3.5 billion euros in losses in the first half of 2014. As the sovereign debt crisis dragged on, The group’s financial hole became unsustainable, dragging down the entire business empire built over decades.
On August 1, 2014, after announcing historic semi-annual losses of 3.5 billion euros, the BES lost half of its stock market value. Unable to show sufficient liquidity to function normally, it set off alarm bells in the country and there was an avalanche of deposit withdrawals. It was a weekend of nerves at the Bank of Portugal that only ended when, at eleven o’clock at night on Sunday, August 3, the then governor of the Bank of Portugal, Carlos Costa, announced to the country that the bank had been divided into two: one part, known as the “bad bank”, kept the toxic assets, while the good part of the bank went to a new banking institution that was “born” a few hours later with the two million clients of the old Banco Espírito Holy.
The BES stopped opening its branches as such: it was renamed “Novo Banco” (New Bank), a financial institution that continues to operate today and that retained the employees and branches of the old BES. The difference is that, since then, the Portuguese State has put more than eight billion euros in the bank in the form of a loan, but no one knows exactly when – the latest date is 2056 – and how they will be recovered, despite the promises that the bankruptcy of the BES “would not cost Portuguese taxpayers anything.”
The vast majority of affected people – many of them Portuguese emigrants with little financial knowledge – have not yet managed to recover all their savings deposited in the bank. These are people who invested their life savings in time deposits with promising interest rates, in investments that they were assured were safe, but that were far from it. In practice, for months, bank employees were instructed to sell clients “commercial paper” type investments, which were nothing more than the debt of the bank and the Espírito Santo group, used to plug the financial hole in which the group was there.
Among the victims, 104 have already died in the last decade without recovering all the money they entrusted to a bank they believed to be safe. In total, the victims claim about 5,000 million euros from the bank. The court will also investigate the criminal responsibilities behind the bankruptcy of what was once the largest private bank in Portugal.
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