Published March 27, 2013
LISBON – The Portuguese government ruled out any chance of a tax on bank deposits under a bailout for Cyprus being used as a template for other euro zone states, and said its own depositors remain confident in Portuguese banks.
"The Cyprus case in unique. There is no risk whatsoever, and this has been said by more than one European official, no risk that this solution may be generalized," Luis Marques Guedes, state secretary for cabinet matters, told reporters after a weekly cabinet meeting on Wednesday.
Debt-ridden Portugal has been under an EU/IMF bailout since mid-2011, implementing tough austerity measures that have pushed the economy into a deep recession.
Cyprus is set to restrict the flow of cash from the island as it tries to avert a run on its banks after agreeing a tough rescue package with international lenders that may involve losses of up to 40 percent on deposits above 100,000 euros.
Prime Minister Pedro Passos Coelho said the Portuguese financial system was well-capitalized and said there was no contagion from the Cyprus situation.
"The is no risk, be it imminent or even vague, of having any disturbances in the financial system," he said. "I hope there is no sick intention of provoking instability in Portuguese depositors who have maintained their confidence."
"The Cyprus situation is very peculiar and will not be used as an example for other countries," he reiterated.
(Reporting By Andrei Khalip and Daniel Alvarenga; editing by Ron Askew)