Title   Emigração, o Novo Desafio da Banca – Caso MBCP (Original)
           Emigration, the New Banking Challenge – MBCP Case (EN)
Author  Cristiana Andreia Silva Magalhães
Advisor  João Filipe Monteiro Pinto
Year  2015
Institution  Portuguese Catholic University 
Degree  Masters
Area  Banking and Insurence
Keywords  Crisis, Emigration, Financial system, Liquidity
URI http://hdl.handle.net/10400.14/19310

Abstract

The 2007/2008 financial crisis and the subsequent European sovereign debt crisis led to liquidity and solvency problems in the Portuguese banking systems, creating the need to implement a new paradigm. Emigration has been gaining a prominent role, not only in Portugal but worldwide. It has established itself as a market segment with high potential not only because of its dimension but also because it represents an alternative source of funding for banks in Portugal. The “Emigrant Market” has taken an important role helping to solve liquidity problems in the domestic banking system. This study is particularly relevant nowadays, to the extent that since 2011 the emigration flow has increased significantly as a consequence of the high unemployment rates caused by the austerity measures imposed by the IMF, ECB and European Commission under the financial assistance plan for Portugal. We develop a case study centered on Millennium BCP, through which we intend to describe and interpret the underlying motivations for the new positioning of Portuguese banks facing this market. We conclude that: : (i) the major reasons for banks to invest in the Emigrants’ market are obtaining liquidity and reducing the cost of funding; (ii) this segment constitutes a significant challenge for the portuguese banking system regarding its size and location; and (iii) the 2007/2008 financial crisis and the subsequent European sovereign debt crisis played an important role in increasing the number of emigrants and their transfers to Portugal.