Portuguese Regulator Bans Short-Selling After Banco Espirito Santo Unveils Massive $5 Billion Loss

Having waited until after the US equity markets closed, Portugal's troubled Banco Espirito Santo unveiled an enormous EUR 3.577 Billion loss - that is 15 times larger than the loss the bank suffered a year earlier. The data  - to end-June, before the crisis really got going - already shows notable deposit flight, a 73.1% plunge in banking income, and a EUR 3 billion collapse in repoable assets (i.e. liquidity). On the heels of this Portugal's securities regulator has enforced a short-selling ban on BES... we suspect they would not have done that if all was systemically well in Portugal.

For some context on the loss... BES market cap at the close today was less than EUR 2 billion...

Highlights (or lowlights) of the data as of June 30th - before the crisis escalated

A collapse in banking income

 

Plunge in liquidity, collapse in Net Income, jump in operating costs, and tumble in total equity...

 

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With the President warning this is systemic, Draghi better hope they can figure out a bailout (or bail-in) soon...

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Full data release below:

BES Results