The Next Domino: Espirito Santo Holding Company Preparing To File Bankruptcy

Tyler Durden's picture




 

While Banco Espirito Santo continues to exist on fumes and life support (that last ditch equity injection by Baupost a week ago may not have been Seth Klarman's wisest investment), a key link in the Espirito Santo Holding Company structure is preparing to default. According to Reuters:

  • ESPÍRITO SANTO GROUPS HOLDING COMPANY RIOFORTE PREPARING TO FILE FOR CREDITOR PROTECTION IN LUXEMBOURG - SOURCES

For those confused, "creditor protection" =  bankruptcy.

Which one is RioForte again? We showed this handy org chart a few days ago, here it is again.

The good news: as every single European bank "expert" predicted last week when scrambling to avoid a panic, there is no fear of contagion. Aside from this one of course. Remember: there is always only one cockroach.

The full report from Reuters:

Rioforte, a holding company of Portugal's troubled Espirito Santo banking clan, is preparing to file for creditor protection, sources familiar with the matter said on Tuesday, hours before Rioforte was due to repay over $1 billion in debt to Portugal Telecom. The filing will be made with a court in Luxembourg, where Rioforte is registered, one source close to the process said, adding that the filing is aimed at preventing insolvency that would entail uncontrolled asset sales at any price.

 

Rioforte declined to comment. The sources would not comment

 

The timing of the filing depends on lawyers working on it in Luxembourg, the sources said.

 

Rioforte holds assets ranging from real estate and hotels to farming and healthcare in Portugal and around the world, as well as a 49 percent stake in Espirito Santo Financial Group - the largest shareholder in Banco Espirito Santo.

 

Another source said recent market turmoil, in which investors dumped BES shares and other Portuguese assets, prevented Rioforte from going ahead on its own with previously-planned debt restructuring and asset sales. Rioforte owes a total of 897 million euros to the country's largest telecom services provider, Portugal Telecom, currently in the throes of a tie-up with Brazil's Grupo Oi , which is likely to amend the terms of the deal in the event of a default.

Needless to say, Portugal Telecom is also sliding now. Because there is no risk of contagion whatsoever!

And now back to Janet Yellen confirming to the entire world the Fed has totally lost it.

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Tue, 07/15/2014 - 10:51 | 4958972 morning
morning's picture

thanks :D

Tue, 07/15/2014 - 11:05 | 4959045 ThaBigPerm
ThaBigPerm's picture

And the three men I admire most-
the Father, Son, and the Holy Ghost-
They caught the last train for the coast

Tue, 07/15/2014 - 16:31 | 4960415 Dead Canary
Dead Canary's picture

The day the music died.

( sigh )

Tue, 07/15/2014 - 10:52 | 4958977 LawsofPhysics
LawsofPhysics's picture

Sorry, these are very small dominos on the global stage.

 

There are Credit Unions in California with greater market share and asset holdings.  Wake me when those start going belly-up.

Tue, 07/15/2014 - 10:56 | 4958992 Tjeff1
Tjeff1's picture

Small dominoes have momentum:

https://www.youtube.com/watch?v=1qoq9jIjpNM

Tue, 07/15/2014 - 11:00 | 4958995 LawsofPhysics
LawsofPhysics's picture

You sir are an optimist.  It's still a "might makes right" world.

Tue, 07/15/2014 - 11:22 | 4959158 El Vaquero
El Vaquero's picture

It will always be a "might makes right" world.  But even a big badass had best be cautious about tripping when next to the cliff's edge. 

Tue, 07/15/2014 - 11:32 | 4959193 LawsofPhysics
LawsofPhysics's picture

No shit.  The point was simply that it also remains a fiat world. Once things get this fraudulent you have to pick your posion, inflation or revolution, both have costs.

Tue, 07/15/2014 - 11:36 | 4959230 El Vaquero
El Vaquero's picture

I think we're going to get inflation and revolution, we'll pay the costs for both, and it won't be pretty. Now, if we can just stay out of WWIII and let mother nature take her own course, that will be the best of the likely outcomes.  Mushroom clouds suck balls.  Especially when they're 20 miles from your home, which I would experience in the event of a bona fide WWIII.  Good thing the Russkies opted to go for smaller warheads than the Soviets had perched upon their SS18s.

 

On the brighter side, the only things from dinner last night that came from a store were the corn, cheese, salt and paprika.  The squash, green beans, green chile, elk and potatos were all harvested by me.

Tue, 07/15/2014 - 13:36 | 4959677 TheReplacement
TheReplacement's picture

Cannot we have both?

Tue, 07/15/2014 - 11:06 | 4959059 Lewshine
Lewshine's picture

Tjeff,

 

Yeah sure! I'm loading August Spy Calls  based on the momentum you expect - Thanks!

Tue, 07/15/2014 - 11:10 | 4959080 dracos_ghost
dracos_ghost's picture

Long dominos!

Draghi will kicksave any Long Term Capital type calamity. In fact, I'm sure he'll amplify this to go full retard on top of full retard. Gee, they fixed the previous crisis, right?

Tue, 07/15/2014 - 16:38 | 4960446 Goldbugger
Goldbugger's picture

And when the Dollar goes so will the world.

 

http://finance.yahoo.com/news/yellen-fed-raise-flag-over-182122231.html

 

Tue, 07/15/2014 - 11:01 | 4959014 _ConanTheLibert...
_ConanTheLibertarian_'s picture

You only need one small domino to kick a bigger domino, which in turn only needs one bigger domino and so on.

It might stop somewhere but it has become so crowded with dominos.

Tue, 07/15/2014 - 11:26 | 4959176 LawsofPhysics
LawsofPhysics's picture

Bullshit.  I can step in and grab a domino at any time.

 

Might still "makes right" folks.

In a fiat world,

revolution or inflation, pick your fucking posion or shut the fuck up.

Tue, 07/15/2014 - 11:29 | 4959202 _ConanTheLibert...
_ConanTheLibertarian_'s picture

They can't control all dominos.

Tue, 07/15/2014 - 11:31 | 4959210 LawsofPhysics
LawsofPhysics's picture

They don't have to.  That's the point.  Pick your posion, inflation or revolution, both have costs.

Tue, 07/15/2014 - 10:53 | 4958978 Kaiser Sousa
Kaiser Sousa's picture

Dow 20,000...

physch..

Tue, 07/15/2014 - 11:00 | 4959008 Sudden Debt
Sudden Debt's picture

silver smackdown... 3...2...1....

 

so predictable...

 

 

Tue, 07/15/2014 - 10:54 | 4958983 Martin T
Martin T's picture

"Our liquidity is fine. As a matter of fact, it's better than fine. It's strong." - Kenneth Lay, ex Enron CEO

 

Tue, 07/15/2014 - 10:53 | 4958984 Devon
Devon's picture

Euro and the banks are fixed. Didn't you get the memo?

Tue, 07/15/2014 - 10:55 | 4958987 youngman
youngman's picture

Those credit unions probably have some derivitive with this bank..its all interconnected....this is like hitting the middle domino in the stack....

Tue, 07/15/2014 - 10:57 | 4958996 Seasmoke
Seasmoke's picture

If a default happens in the woods outside the US, does anyone hear it ???

Tue, 07/15/2014 - 10:58 | 4958998 Kaiser Sousa
Tue, 07/15/2014 - 11:01 | 4959015 youngman
youngman's picture

nice...dump it if you dont have it...just paper will do...

Tue, 07/15/2014 - 11:02 | 4959017 Sudden Debt
Sudden Debt's picture

first smackdown of 2 is happening today.

 

First will bring it to 20,5, second will bring it to 19.8

 

Tue, 07/15/2014 - 11:07 | 4959060 Kaiser Sousa
Kaiser Sousa's picture

you really think so...
got my cart at Apmex ready to confirm...
decisions, decisions....

Tue, 07/15/2014 - 11:02 | 4959020 1stepcloser
1stepcloser's picture

cheaper is good for stacking..

Tue, 07/15/2014 - 10:58 | 4959000 disabledvet
disabledvet's picture

That's a hell of a phone bill. Don't they have Internet cafés over there?

Tue, 07/15/2014 - 11:01 | 4959012 Racer
Racer's picture

creditor protection ???????????????

Tue, 07/15/2014 - 11:02 | 4959018 Ban KKiller
Ban KKiller's picture

Debt is on sale...again and again and again. Shearing the sheep is always in season. Now this load of toxic crapola will be repackaged and sold to the yield whores. Know any? 

Tue, 07/15/2014 - 11:03 | 4959023 WTFUD
WTFUD's picture

As a potential investor i called the Gruupe de Companies concerned and they told me to FUCK OFF YOU CUNT!!!

That's not right in my book, hardly the language you'd expect from listed companies albeit with this huge crises kicking at their door. snigger

Tue, 07/15/2014 - 11:15 | 4959111 Inthemix96
Inthemix96's picture

So then, July the 20th draws very near.

Be a smashing weekend for a bank holiday, wouldnt it bitchez?

Oh, and by the way, the replaced Forgein Secretary of Britain here, Mr 'Little' Willie Hague, has a very nefarious past, thats why he's been replaced.

The shit is about to hit the fan my friends, there will be Peedo's all over the place.

And the doddering old lady Butler-Sloth, through public opinion has stood down as the over-see'er of the Peedo scandal at the sprightly age of 81, as her brother was in charge of the last Peedo cover up.

Its falling apart, oh dear, it seems like its coming away at the seams.

If you know what I mean like.

Again, once again, Cunts, to the very last.

;-)

Tue, 07/15/2014 - 11:34 | 4959219 LawsofPhysics
LawsofPhysics's picture

Optimist.

Tue, 07/15/2014 - 11:46 | 4959267 Inthemix96
Inthemix96's picture

Smile Laws,

Dont let the bastards get you down.

It will happen mate.

Trust me, I know these things....

;-)

Tue, 07/15/2014 - 12:11 | 4959380 smacker
smacker's picture

Inthemix96: I'm glad you're following this pedo scandal. It's been covered up for decades and allegedly goes right to the top of the Four Estates and Establishment. I mean right to the top with plenty of people at other levels involved.

Jimmy Savile will look like small fry if/when the whole truth comes out. That's why I cannot believe the truth will ever be allowed to emerge. MI5 will be on hand to deal with anyone who attempts to spill the beans. "The State" is at risk.

Tue, 07/15/2014 - 12:16 | 4959408 WillyGroper
WillyGroper's picture

They didn't do to well covering up the 600 in Ireland

Tue, 07/15/2014 - 12:30 | 4959455 Inthemix96
Inthemix96's picture

Smacker, my friend.

They will have to shut the internet down.

Do you think they could do that?  No?  Neither do I.

Get this into your head my friend, and I mean this as no disrespect, and in the utmost sincerety.

We are fucking legion, each and every last one of us truth talking cunts.

And to you lot of cunts watching this,

Come on then, come and get some.  For every 96 you get rid of, there will be many more who take my place.

Evil, filthy, disgusting, depraved, fucking degenerate fucking filth what you are.  Know this, not everyone is afraid of keeping their mouths shut you child abusing bastards.

The truth, as it always will, will out.

You better get on the right side of history and pray for your lost fucking souls you cunts.

We know.

Smile, you're on candid fucking camera....

;-)

Tue, 07/15/2014 - 12:14 | 4959395 WillyGroper
WillyGroper's picture

@ITM96, I hope you're right. got any links?

Tue, 07/15/2014 - 12:34 | 4959463 Inthemix96
Inthemix96's picture

Sorry mate, I dont.

I'm thick on a computer, but go-ogle order-order, and take it from there.

These fuckers are beyond the pale, but public opinion, and the interwebs are going to right the score.

Of that, I fucking firmly believe.

They must be fucking shitting themselves, and if they arnt, they fucking well should be.

96

Tue, 07/15/2014 - 12:36 | 4959470 Inthemix96
Inthemix96's picture

Here Willy,

Google this bloke, Chris spivey.org, search the archives, your head will explode.

And I have fuck all to do with this fella, but he is very well reaserched.

;-)

Tue, 07/15/2014 - 11:20 | 4959145 froze25
froze25's picture

Is there a crack forming in the Dike?

Tue, 07/15/2014 - 11:36 | 4959233 HardlyZero
HardlyZero's picture

Bulgaria is going Cyprus.

Bulgaria asks ECB to oversee its banks

Bulgaria has asked the European Central Bank to take over supervision of the country's banks, a week after the collapse of its fourth-largest bank and amid accusations of lending fraud by its major shareholder.

Bulgaria announced on Monday that it would seek to join the EU's new 'banking union' a few days after the collapse of Corporate Commercial Bank (CCB), the country's fourth-biggest lender, amid accusations of corrupt lending practices.

"There is full consensus for an immediate start of procedures for Bulgaria's entry into the Single Supervisory System of the European Union as a first step to joining the EU's banking union," President Rosen Plevneliev said on Monday in Sofia, the country's capital.

If the EU approves Bulgaria's application, the European Central Bank (ECB) will take over supervision of Bulgaria's banks along with those of other members of the new banking union on November 4.

Bulgaria would be the first country that does not use the euro as its currency to join the banking union. But the country's currency, the leva, is already tied to the euro through an IMF-led currency board arrangement that pegs the leva to the euro at a fixed exchange rate.

http://www.dw.de/bulgaria-asks-ecb-to-oversee-its-banks/a-17786854

Tue, 07/15/2014 - 11:51 | 4959293 Ghordius
Ghordius's picture

HardlyZero, thanks for the post. Nevertheless, this is hardly "going Cyprus". if you remember, Cyprus was against several ECB proposals, and for example closed it's "financial borders" like Iceland

Bulgaria, by the steps you mention, is doing the opposite, and asking for help and supervision

Tue, 07/15/2014 - 12:22 | 4959429 conspicio
conspicio's picture

I was wondering why Espirito Santo was getting all of the press when the Corporate Commercial Bulgarian collapse is equally as striking. Now that the Eurpean Single Supervisory Mechanism membership is on deck for Bulgaria, Rossen Plevneliev should be booted out for the liar he has been exposed to have been over the past few months in these banking matters. Their Yellen, a fine fine man (/s) named Ivan Iskrov insisted at the end of June the banking system was functioning without a problem. Looks like the banking collapse of the mid-90s are back in style with Bulgaria.

Tue, 07/15/2014 - 11:49 | 4959269 Handful of Dust
Handful of Dust's picture

I'm sure the 'family' memebers took hefty bonuses for themselves before contemplating bankruptcy. All those "bad loans"...someone still has that money tucked away somewhere so it's not 'bad' for them, just the suckers who own the bank shares.

Tue, 07/15/2014 - 11:47 | 4959270 orangegeek
orangegeek's picture

we need China or France or Germany to pop

 

this is small potatoes

Tue, 07/15/2014 - 12:16 | 4959406 yogibear
yogibear's picture

Take all your bank reserves and ship them to off-shore accounts. Bankrupt the financial institution. End up a billionaire performing fraud and being too big to fail.

Bailouts are a rinse and repeat cycle.

The ECB will bailout forever. Just cook your books and the EU will hide the fraud.

Tue, 07/15/2014 - 12:24 | 4959438 mtndds
mtndds's picture

Damn the agony!  When is this shit finally going to correct itself?  The Fed keeps beating this dead mule to move and they cant see its already fucking dead!

Tue, 07/15/2014 - 16:15 | 4960363 SmittyinLA
SmittyinLA's picture

could get worse, Portagees could decide to terminate their cellular service to pinch the jerkoff bankers out of spite and for sport too, World Cup is over, people need somebody to root against, sombody to hate somebody to stomp 

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