Abstract
It is widely acknowledged that public banks have the potential to play an anti-cyclical role in times of economic crisis. As lending by private banks dries up, public banks step in. The world is currently confronting a twin crisis: a pandemic that has generated a profound recession. Within this public health and economic crisis, what role do state-owned banks play? This chapter examines how Caixa Geral de Depósitos (CGD) has responded to the crisis in Portugal. It shows that the CGD acted swiftly when faced with a pandemic. It launched its own initiatives and it played a role within the Portuguese Government’s response. Some of the most important measures were the debt moratoria, various credit lines and a series of steps to facilitate the digitalization of finance. These measures helped to accommodate the lockdown and to mediate its economic effects on families and businesses. Despite this, the bank’s initiatives need to be understood within the competitive – and indeed profit seeking – logic in which the CGD operates. Further research is required to investigate the extent to which CGD’s response differed from that of the private banks.
Original language | English |
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Title of host publication | Public Banks and Covid-19: Combatting the Pandemic with Public Finance |
Editors | David McDonald, Thomas Marois, Diana Barrowclough |
Place of Publication | Kingston / Geneva / Brussels |
Publisher | UNCTAD |
Chapter | 15 |
Pages | 311-332 |
Number of pages | 22 |
Publication status | Published - 14 May 2021 |