Finance Minister Rejects an Expert Panel's Proposal to Merge Portugal's Three Financial Supervisors

A plan to consolidate Portugal’s financial oversight into a single super-regulator has been knocked back by the government almost as soon as it was tabled. Finance Minister Joaquim Miranda Sarmento has rejected a recommendation to merge the country’s three financial supervisors, signalling that the most eye-catching reform from a high-level review will go no further for now.

The proposal came from a working group set up in December 2025 and chaired by Jorge Vasconcelos, a former president of the energy regulator ERSE (Entidade Reguladora dos Serviços Energéticos, the Energy Services Regulatory Authority). On 24 June the seven-member panel delivered 20 recommendations, the boldest of which was to fuse the Banco de Portugal (Bank of Portugal), the Comissão do Mercado de Valores Mobiliários (CMVM, the Securities Market Commission) and the Autoridade de Supervisão de Seguros e Fundos de Pensões (ASF, the Insurance and Pension Funds Supervisory Authority) into one body.

The case for a single authority

The group argued that the lines between banking, securities and insurance have grown increasingly blurred, with products and risks spilling across what used to be separate markets. In that environment, it said, a centralised authority is “frequently considered the most adequate governance structure” — the model already adopted in several other European countries.

Why Sarmento said no

The Finance Ministry was unconvinced. Within roughly two days, government sources made clear that the minister favours “deepening institutional coordination mechanisms” between the existing regulators rather than collapsing them into one.

The objections were threefold. First, Portugal’s three-pillar supervisory architecture mirrors common European Union practice, with each body pursuing “differentiated, although complementary” regulatory and prudential goals. Second, the ministry raised “relevant doubts” about whether a merger would be compatible with European rules governing the Bank of Portugal, which sits inside the European System of Central Banks and the Eurosystem and must guard its independence and financial autonomy. Third, folding the supervisors together would risk the “extinction and organic integration” of institutions with materially distinct competencies.

Sarmento also rejected a second, related recommendation: that the pay of regulators’ senior administrators be aligned with that of comparable European agencies, adjusted for Portugal’s lower cost of living. The ministry countered that current remuneration already sits at “elevated levels” relative to other public officials and to peer institutions abroad, and that any increase would require a careful look at necessity, proportionality and budgetary impact. It added that the government does not, in any case, hold unilateral power to set regulators’ pay.

Alongside Vasconcelos, the commission included Ana Lourenço, João Calvão da Silva, Margarida Matos Rosa and Tiago Duarte, plus representatives of the finance, presidency, economy and reform portfolios. Despite being government-appointed, the panel has seen its flagship idea shelved within days — a sign that most of its 20 proposals may face a similarly steep climb to implementation.