Article by Pedro Cassiano Santos and Paula Gomes Freire in Chambers & Partners guide

Pedro Cassiano Santos and Paula Gomes Freire, partners at VdA's Banking & Finance practice are the authors of Chambers & Partners editorial on the Portuguese scenario regarding this area. "Banks and financial institutions are facing unparalleled challenges: first banks need more capital as stricter capital requirements flow from Basel III and take shape under the CRD IV, secondly banks need to change their asset book composition as risks are re-evaluated and require downsize of portfolios of assets and thirdly they need to think hard about their funding cost because with declining internally generated profits and virtually no access to the markets, reliance on either the European Central Bank or government funds naturally plays a key role. In parallel, banks are urged to ensure the flow of credit to the real economy.

This, together with the framework imposed by the Financial Assistance Programme to Portugal, constitutes the backdrop of market conditions that has shaped the provision of legal advice to the banking sector over the past 12 months and as ever, changes and difficulties, usually offer interesting opportunities" write VdA's partners.