The Reform of the Financial Supervision Portuguese System

When the empowered Government at the time announced its intention to discuss the organizational model of Financial Supervision in Portugal, Schiappa Cabral & Associados contributed for the debate, by disclosing a study by Sofia Nascimento Rodrigues, entitled “A Reforma do Sistema Português de Supervisão Financeira” (The Reform of the Financial Supervision Portuguese System).

In 2010, the XVII Constitutional Government in power at that time undertook the compromise of improving the institutional model of financial supervision and published a promising project, which can be visited at www.gpeari.min-financas.pt.

This project, which did not come to light, aimed the development of the tripartite system that still prevails in Portugal - and allocates the functions of regulation and of supervision of financial system between BdP - Banco de Portugal (Bank of Portugal), CMVM -Comissão do Mercado de Valores Imobiliários (Portuguese Stock Market Regulator), ASF - Autoridade de Supervisão de Seguros e Fundos de Pensões (Supervisor Authority of Insurance and Pension Funds)– for a two-party system or “Picos Gémeos” (Twin Peaks).

But if 6 years ago, words like “improvement”, “gap-filling”, and “model update” guided the reasons for the reform, nowadays we must recognize that, more than that, the main issue is the need to strengthen public confidence in the Portuguese financial system.

Whatever it is the political and legislative, technical and institutional debate to develop, an institutional architecture that translates in a harmonious way the goals of the financial system supervision, should be searched. These goals must remain the same: from the prudential supervision, the stability of financial system, based on the economic and financial stability of each of the supervised institutions and risk prevention; from the conduct supervision, monitoring the institutions behaviour and the protection of the rights and of legitimate interests of consumers of financial services.

Schiappa Cabral remains focused on the subject and will follow, by publishing in this site all the news that may emerge.