European banks' government bond binge sparks regulatory concern | Reuters
This article does not specifically focus on Portugal but highlights a broader trend among European banks increasing their holdings of government bonds by 14% over the past year, partly driven by ECB policies and rising government borrowing. It notes that some eurozone countries, including Portugal, are under scrutiny regarding their debt levels and fiscal stability. The surge in bond holdings raises concerns about potential risks, such as a sovereign-bank doom loop, especially if economic conditions worsen or yields spike. Overall, while manageable now, regulators warn that increased exposure to sovereign debt could pose systemic risks if fiscal or market stability deteriorates.
