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Though the bailout agreement covers three years, Portugal will have to tap markets to meet a
euro9.7 billion bond redemption in September 2013. Some analysts predict Portugal will need more time and money to help it through the eurozone's ongoing sovereign debt crisis and a possible global economic downturn. The government insists it won't need any more aid. Portugal has profited from broad political consensus in enacting the bailout program, which was signed by the two center-right parties in the current coalition government and the center-left Socialists who are the largest opposition party in Parliament. However, the Socialists have recently called for more policies focused on growth. Socialist spokesman Eurico Dias said Monday it was "shocking" that the government could call the program a success when it had brought a record jobless rate. Gaspar said the government intends to raise revenue by privatizing flag carrier TAP Air Portugal and airport management company ANA this year, though the sale of rail freight company CP Carga has been postponed to 2013. Portugal raised
euro3.3 billion last year with the sale of controlling stakes in energy company Energias de Portugal and grid operator REN, both blue-chip companies. Also Monday, the Finance Ministry announced it will inject more than euro6.6 billion into three of Portugal's largest banks. Banco Comercial Portugues, Banco Portugues do Investimento and state-owned Caixa Geral de Depositos need the money to meet new European capital requirements. Some
euro5 billion of that aid will come from a euro12 billion government recapitalization fund, the Finance Ministry said in a statement. The banks said they will also seek to issue self-financing bonds. European banks are required by law to shore up their capital cushions by the end of June. They need to increase their core tier 1 capital ratio
-- the amount of high-quality capital as a percentage of the riskier assets held
-- to 9 percent. The measure aims to strengthen lenders against financial market uncertainty amid the continent's debt crisis.
[Associated
Press;
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