| 13 July 2024, Saturday |

Portuguese central bank to assess governor’s conduct

The ethics committee of the Bank of Portugal will meet on Monday to assess the behavior of Governor Mario Centeno. Centeno’s independence was called into doubt when the outgoing prime minister suggested he be considered as a possible successor, according to the local media.

Antonio Costa resigned on Tuesday after an inquiry into purported irregularities in his administration’s management of renewable energy initiatives, compelling President Marcelo Rebelo de Sousa to convene a snap election on March 10. Costa refutes any misconduct.

On Thursday Costa said that, as an alternative to an election, his Socialist party (PS) had proposed to Rebelo de Sousa that he appoint Centeno, a respected European Central Bank policymaker and former finance minister in Costa’s administration, as premier.

Local media reported that Centeno had agreed to let his name go forward, raising concerns that his links to the PS remained strong and calling into question his independence if he remained central bank governor.

Rebelo de Sousa rejected Costa’s proposal and called the election instead.

Opposition parties were quick to react, with the parliamentary leader of the main opposition Social Democrats, Joaquim Miranda Sarmento, saying the episode was “another demonstration … of his (Centeno’s) lack of independence”.

Centeno’s quick move from the finance ministry to the central bank in July 2020, during Costa’s second term, had previously raised eyebrows. Centeno announced his departure from the finance ministry in June 2020 and was nominated a month later.

Costa’s office said he would address the nation at 8 p.m. (2000 GMT), but it was not clear what he planned to say.

The online economic newspaper Eco said the ethics committee was gathering information about Costa’s proposal of Centeno and would meet on Monday to evaluate the allegation of lack of independence.

A central bank spokesperson said it was up to the committee to comment on the matter.

The newspaper Jornal de Negocios said the committee would publish its opinion shortly after the meeting.

One of its responsibilities is to supervise the conduct of the bank’s directors. It meets every three months, or more often if required.

  • Reuters