Portugal is a developed country in Southwestern Europe (Iberian peninsula), a member of the European Union since 1986.
Portugal is a developed country with a high-income advanced economy and a high living standard. In the recent decades Portugal has become a diversified and increasingly service-based economy. Main industries of the Portuguese economy include automotive, aerospace, electronics and textiles as well as textiles, clothing, footwear, wood and cork.
In 2010-2013 Portugal suffered a financial crisis, among the other reasons resulted from the collapse of Banco Português de Negócios (BPN) and the bankruptcy of Banco Privado Português (BPP). In 2011 Portugal received a financial bailout from International Monetary Fund and the European Union. In August 2014 the largest bank in Portugal, Banco Espirito Santo (BES) went bankrupt. Currently Portuguese banking sector is dominated by domestic banks with a number of foreign-controlled banks operating in Portugal.
|Population (2016)||10 341 330 (0.00%)|
|EU Status||member since 1986|
|National Currency||EUR (Euro) since 1 January 1999|
|Nominal GDP (2015)||179.4 bln EUR (+0.04%)|
|Nominal GDP per Capita (2015)||17 300 EUR (+0.04%)|
|Real GDP Growth (2015)||1.5 % (2014: 0.9 %)|
|CPI, MoM (Dec 2016)||0.0 % (Nov 2016: -1.0 %)|
|CPI, YoY (Dec 2016)||0.9 % (Nov 2016: 0.5 %)|
|CPI, Year Average (2016)||0.6 % (2015: 0.5 %)|
|Unemployment Rate (2015)||12.6 % (2014: 14.1 %)|
|Government Bond Yield (Dec 2016)||3.74 % (Nov 2016: 3.51 %)|
|Credit Ratings (as of Sep 2016)|
|Fitch||BB+||speculative, outlook stable|
|Moody's||Ba1||non-investment grade speculative, outlook stable|
|S&P||BB+||non-investment grade speculative|
|Double Taxation Agreements||67 signed agreements|
|Exchange on Request||16 signed agreements|
|Automatic Exchange||starts in September 2017|
|FATCA||IGA in effect since 06 August 2015, Model 1|
|Financial Market Development||3.3 (max 7.0)||rank: 116th out of 138 countries|
|Banks' Soundness||3.3 (max 7.0)||rank: 129th out of 138 countries|
|Banking Industry Country Risk||7||(1 - lowest risk, 10 - highest risk)|
|Deposit Guarantee Scheme|
|Maximum Protected Amount||100 000 EUR|
|Country Ceiling for Deposits|
|Local Currency (Euro)||A1||upper medium grade|
|Foreign Currency||A1||upper medium grade|
|Deposit Rates (Nov 2016, EUR)||0.32 % (unchanged)|
|Banking Sector Structure|
|Number of Banks||150|
|Recent Changes (2016)||new banks: 3, closed banks: 1|
|Consolidated Assets (2015)||408.12 bln EUR (-4.19%)|
|Caixa Geral de Depositos, SA||Banco BPI, SA|
|Banco Comercial Portugues, SA (BCP or Millennium BCP)||Banco Santander Totta, SA|
|Banco Espirito Santo, SA|
|List of Banks in Portugal|
Portugal joined the Euro Area on 1 January 1999.
According to Eurostat, nominal GDP of Portugal in 2015 was 179.4 bln EUR.
Portugal underperforms the European Union in terms of real GDP growth with the average annual differential coming to -0.8% over the past 10 years (2005 - 2015). In 2015 real GDP growth was 1.5% which was below the Euro Area average (1.6%) and below the European Union average (1.9%). Real GDP growth in 2016 - 2021 are IMF's estimates.
In 2015, nominal GDP per capita in Portugal was 17 300 EUR.
Portugal has a below-average level of wealth in terms of per-capita GDP at purchasing power parity (PPP); this economic welfare indicator has, on average, fell behind that of the European Union by -23.4% over the past 10 years (2005 - 2015). GDP per capita at PPP in 2016 - 2021 are IMF's estimates.
According to Eurostat, inflation rate in Portugal in 2016 expressed as annual percentages of average consumer prices was 0.6% which was above the Euro Area average (0.2%) and above the European Union average (0.3%). Inflation rates in 2017 - 2021 are IMF's estimates.
Double Taxation Agreement (DTA) is an agreement between two or more countries for the avoidance of double taxation.
Portugal signed DTAs which already came info force with the following jurisdictions (for agreements which came into force after 01 January 2013 the date of coming into force is given in brackets):
There are also several agreements between Portugal and other jurisdictions which were signed but haven't yet come into force (for agreements signed after after 01 January 2013 of signing the agreement is given in brackets):
There are 3 ways for jusrisdictions to exchange information on tax matters:
Spontaneous exchange of information is provision of information that is forseeably relevant to another party without a request being previously sent.
Tax Information Exchange Agreements (TIEAs) enable exchange of information on request relating to a specific tax investigation, either criminal or civil.
Portugal signed TIEAs which already came info force with the following jurisdictions (for agreements which came into force after 01 January 2013 the date of coming into force is given in brackets):
There are also several agreements between Portugal and other jurisdictions which was signed but haven't yet come into force (for agreements signed after 01 January 2013 of signing the agreement is given in brackets):
Automatic information exchange allows jurisdictions to exchange information automatically, without having a specific tax investigation.
Portugal signed the automatic information exchange agreement on 29 October 2014 and committed to start the automatic information exchange in September 2017.
Foreign Account Tax Compliance Act (FATCA) which became law in the United States in March 2010, focuses on reporting made by foreign financial institutions about financial accounts held by US taxpayers or foreign entities in which US taxpayers hold a substantial ownership interest. The FATCA-reporting is facilitated by Intergovernmental Agreements (IGAs).
Portugal has FATCA agreement with the U.S. in effect since 06 August 2015 (Intergovernmental Agreement Model 1). Financial institutions operating in Portugal are required to identify U.S. taxpayers by January 1, 2017 and to report the information for 2017 and the subsequent years. The agreement is reciprocal: Portuguese financial accounts hold in U.S. financial institutions will be reported to Portuguese authorities.
FATCA and European countries
According to World Economic Forum's Global Competitiveness Report 2016-2017, financial market development in Portugal is scored 3.3 out of maximum 7.0 and ranked 116th out of 138 analysed economies. Soundness of banks is scored 3.3 bringing Portugal into the 129th place, trustworthiness and confidence of financial market is scored 2.9 (133rd place).
Banking Industry Country Risk Assessment (BICRA) is a methodology designed by Standard&Poor's "to evaluate and compare global banking systems". A BICRA is scored on a scale from 1 to 10, ranging from the lowest-risk banking systems (group 1) to the highest-risk (group 10). The BICRA methodology has two main analytical components: "economic risk" and "industry risk". Each of the components is then further divided into 3 "factors" that result in an economic and industry risk score for each country.
Portugal is included into group '7' with economic risk scored '7' and industry risk scored '6'.
|Credit risk in economy||very high|
|Systemwide funding||very high|
|Government support assessment||supportive|
Deposit Guarantee Schemes compensate certain deposits held by depositors of a bank that becomes unable to meet its obligations.
From a depositor's point of view it is important to know:
All these details about deposit guarantee scheme in Portugal are summarised in Table 2.
|Scheme Participants||all credit institutions operating in Portugal, branches of non-EU banks, branches of Portuguese banks abroad|
|Scheme Exemptions||branches of EU-banks (covered by their home countries)|
|Covered Accounts||any type of deposit, certificates of deposit|
|Maximum Protected Amount||100 000 EUR|
|Paid In Currency||EUR|
Table 2. Deposit guarantee scheme in Portugal.
Deposit Guarantee Schemes in Europe
Moody's country ceilings for deposits specify the highest rating that can be assigned to local- or foreign- currency denominated deposit obligations of a bank or other deposit taking institution domiciled within that country.
Local currency (Euro) deposit ceiling for Portugal is set to A1 (upper medium grade), foreign currency deposit ceiling is A1 (upper medium grade).
Compare Bank Deposits in Portugal
Currently there are 150 credit institutions operating in Portugal.
Recent structural changes (2013 - 2016) of the banking sector of Portugal are summarised in Table 3.
|Number of Opened Banks||3||1||1||3|
|Number of Closed Banks||1||4||4||1|
Table 3. Recent structural changes in the banking sector of Portugal.
All the credit institutions operating in Portugal can be classified into several categories. Table 4 summarises the number of banks in each category.
|Category||Number of Banks|
|Branches of foreign banks||20|
The list of the most recently opened banks in Portugal is provided in Table 5.
|WIZINK BANK SA - SUCURSAL EM PORTUGAL (new)||December 2016|
|Bankinter, SA - Sucursal em Portugal (new)||April 2016|
|BANQUE DE PATRIMOINES PRIVÉS - SUCURSAL EM PORTUGAL (new)||February 2016|
|BANCO CTT, SA (new)||October 2015|
|BNI - Banco de Negócios Internacional (Europa), SA (new)||August 2014|
|Credit Suisse (Luxembourg), SA - Sucursal em Portugal (closed)||November 2013|
|Bank of China (Luxembourg), SA Lisboon Branch - Sucursal em Portugal (new)||August 2013|
|Volkswagen Bank GmbH - Sucursal em Portugal (new)||March 2013|
Table 5. The most recently opened banks in Portugal.
There are 21 branches of foreign banks from 10 different countries in Portugal. Table 6 shows the number of branches grouped by the country of origin.
|Country of Origin||Number of Branches|