New mortgage rules lower debt-to-income limits
Starting this Saturday, new macroprudential measures from the Bank of Portugal (Banco de Portugal) will lower the debt-to-income ratio for mortgage applicants to 45%. While the move aims to protect buyers, banking leaders like Paulo Macedo, CEO of Caixa Geral de Depósitos, anticipate a potential 10% drop in credit production. Experts advise applicants to prepare complete dossiers and consult multiple institutions to navigate the stricter approval environment.
Banco de Portugal is Portugal's central bank, founded in 1846. It is a member of the European System of Central Banks (ESCB) and the Eurosystem, working alongside the European Central Bank (ECB) to implement monetary policy in the euro area.
Its main functions include supervising banks and financial institutions, ensuring financial stability, managing Portugal's gold and foreign currency reserves, and producing economic research and statistics. It also operates the payment systems infrastructure and issues banknotes.
Banco de Portugal is led by a Governor — currently Mário Centeno (since 2020) — who also sits on the ECB's Governing Council. For residents, the central bank matters because it regulates the banks they use, sets macroprudential rules (such as mortgage lending limits), and provides a complaints mechanism for banking disputes.
Caixa Geral de Depósitos is Portugal’s largest state-owned bank and a major retail and corporate lender. In 2025 it posted a 10% profit increase — helped by selling its stake in Águas de Portugal — and will pay a €1.25 billion dividend to the State, which can affect public finances and confidence in the banking sector.
