Public Banking, Overlapping Emergencies, and the Eurozone Periphery: The Portuguese Case

It is well known that public banks are important agents of crisis management in times of financial instability, but less is known about their potential to combat other disasters, such as public health emergencies and environmental breakdown. The dynamic theory of public banking has problematised these institutions as situated within capitalist, and often financialised, and class divided societies, but further inquiry is needed into their variegated characteristics and the way this is contingent on uneven and differentiated forms of integration into global capitalism. This article focuses on the case of Portugal, a country with a peripheral integration the Eurozone. It demonstrates that public banks showed a strong ability to tackle the socio-economic ramifications of the Covid-19 pandemic. Public banking measures that gave families and firms time to breathe included credit lines, often with state guarantees, and debt moratoria. Crucially, a new public financial institution was launched. When it comes to the climate crisis however, Portuguese public banking is limited by the EU’s power over these institutions and its market-oriented approach.