Short-selling in shares of Portugal’s largest private bank Banco Comercial Português (BCP) was halted for the second time in a week today by the country’s financial regulator.
The Portuguese Securities Market Commission said the ban – effective across all venues upon which the shares are traded – follows a fall of more than 10% in the value of the shares on Friday 3 June. The Portuguese regulator issued a similar ban on Wednesday last week.
The news comes just days after analysts at Goldman Sachs named the bank in a report outlining financially vulnerable institutions since the European sovereign debt crisis.
BCP is the latest of the ‘PIIGS’ (Portugal, Italy, Ireland, Greece, Spain) banks to be back in the headlines as analysts again look at the financial stability of European banks.
Last week, the fourth largest bank in Spain – Banco Popular – announced it was making a EUR 2.5 billion rights issue to offset bad property investments. The announcement saw the bank’s share price drop by more than a quarter.
Despite rescue efforts, 2016 has proved a bad year for BCP, having lost around half of its market cap since the start of the year.
The bank received a EUR 3 billion rescue package from the Portuguese Government in 2012 after the bank was declared insolvent, having failed to meet capital targets set by the European Banking Authority.
Banco Comercial Português was unable to comment at the time of publication.