PARLIAMENTARY INQUIRY NO. 7/X

The Possible Commission of Parliamentary Inquiry into the exercise of the

supervision of the banking, insurer and market systems of

capitals

Considering that the effective, diligent, preventative and proactive exercise of the responsibilities committed by law to the supervisory authorities of the banking, financial and capital market systems is a public good of enhanced value; Whereas the existence of serious failings in the exercise of these responsibilities may induce a systemic risk detrimental to the reputation and credibility enjoyed by the banking and financial system and the national Exchange; Whereas some of these illicit were object of public denunciation or have otherwise arrived at the knowledge of the said supervising authorities and who will eventually have not had the appropriate enqutment and punishment, nor induced the reinforcement of preventive supervision procedures likely to prevent or hinder their future repetition; Whereas many of these alleged ilocytes will already have possibly prescribed under the applicable law against applicable ordinance and that this constitutes a perverse incentive favorable to the generalization of the practice of these illicit;

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Considering that this perverse effect is potentiated by the fact that currently the activity of the so-called universal banking-which integrates the traditional activities of commercial banking, investment banking and insurance business-unfolding in a single world financial market, where they include jurisdictions off-shore on the margins of the exchange of information and transparency of the national financial squares of the developed countries in which Portugal integrates; Whereas in reference countries, such as the United Kingdom and the USA, the occurrence of serious illicit, in similar part, it triggered parliamentary inquiries and initiatives, not only evaluation of the performance of the supervisory authorities, but also of the legal framework in which these operate and, including, the respective global model of supervision; Taking into account that they were heard in the Budget and Finance Committee, the Lord Governor of the Bank of Portugal, the President of the CMVM and the Minister of State and Finance, in this case also in the quality of former CMVM President, and still Dr. Filipe Pinhal, former President of the Millenium/BCP Bank and that the indications of existence of serious flaws in the exercise of the above-referenced supervisory responsibilities have been corroborated, expanded and adended by this set of hearings; Whereas, in relation to the indispensability of thoroughly reviewing the framework legal from the exercise of the said supervisory activities, as well as the notorious inadequacies of the schemes against applicable ordinances-in order to better prevent and prevent the occurrence of new and relevant serious unlawful, taking into account the increasing sophistication and mutation of the procedures and vehicles used by the offenders-the Government

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has declared to be satisfied with the current legislation and that it does not intend to promote its review; The PSD Parliamentary Group has been applying for its Excellency the President of the Assembly of the Republic under the provisions of paragraph 1 (b) of the article of the 2º of Law No. 5/93 of March 1, republished after its second amendment introduced by Law No. 15/2007 of April 3, the carrying out of a parliamentary inquiry, as well as the constitution of the respective Parliamentary Committee of Inquiry to appreciate the acts of the Government and the following banking and financial supervisory entities, the Bank of Portugal, the Market and Securities Commission and the Insurance Institute of Portugal, according to the subject matter and the fundamentals to be explained. The Parliamentary Committee of Inquiry has the subject matter, specifically:

1. Determine the thoroughness with which the supervisory duties of the Bank of Portugal have been fulfilled in the prevention and enquiries of especially serious offences, provided for in Article 211º and in other articles of the General Regime of Credit Institutions and Societies Financial, in relation to the generality of the entities under its supervision and, in particular, the Millenium Bank / BCP, forward BCP, specifically in the period from January 1999 a to December 2005;

2. Spurt if the supervision worked properly in

increased social capital raising operations, predominantly financed by the granting of credit from the offeror to the underwriters, and specifically in the cases of the increases in the social capital of the BCP, carried out in 2000 and 2001;

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3. Apurar in what objective conditions the Bank of Portugal considers the existence of fraudulent social capital achievements to be verified;

4. Check, what was the analysis done and what were the conclusions drawn and its legal underpinnings from banking supervision regarding multiple complaints, specifically from small shareholders who deemed themselves aggrieved, by such practices eventually irregular bidders and ascertain if the same ones had follow up.

5. Determine the rigor with which the duties of

supervision of the Bank of Portugal in the prevention and fact-finding of operations conducted by entities under its supervision and concerning the use of these financial vehicles in jurisdictions off-shore not subject to the duties of transparency and international cooperation recommended by the European Union and the OECD whose constitution and activity would indict the practice of serious or especially serious offences provided for in the law;

6. To purge the fulfillment of these duties in institutions

supervised, particularly in the years 2000 a to 2004;

7. Apurar if banking supervision has adequately used the means within its reach, to identify vehicle companies domiciled in jurisdictions off shore , it has required supervised institutions, and in particular the BCP, and has acted appropriately to prevent and prevent in the future the occurrence of new cases similar to those it investigated during the period 2002 a to 2004.

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8. Apurar if the banking supervision required, above all in the period under review, to supervised institutions all the information that it should apply to the respective social bodies on how they decided to constitute such vehicles off-shore.

9. Apurar if the intervention of the Lord Governor of the Bank of Portugal, when convening for a meeting, a sub group of BCP reference shareholders, on December 21, to address issues related to the General Assembly of this Bank convened for 15 of January, constituted a precedent, whether it is practice to follow and in what situations or if, on the contrary, it is immeasurable with the duties of exemption and independence that the regulators must have vis-à-vis supervised institutions and their stakeholders , notably shareholders.

10. To purge whether or not this performance by the Lord Governor injures or not the right to equal information on listed companies that all current or potential shareholders of the institutions have, pursuant to the Securities Code.

11. Apurar in all situations identified above, in what is applicable, the performance of the CMVM and the National Council of Financial Supervisors;

12. Apurar because allegedly the CMVM will not have acted

in a timely manner to ensure, pursuant to the Securities Code, the defence of the interests of small shareholders, allegedly treated differently in relation to some major shareholders, in the cases of the capital increases carried out by the BCP in 2000 and 2001, which originated damages arising from the execution of the pledge of the Bank's shares given in guarantee of credits from the same for purchase of its shares.

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13. Apurar because allegedly the CMVM, in particular in the

period from 1999 a to 2005, it will not have ascertained sufficiently, with the means at its disposal, the operations of social capital increases conducted through such vehicles off shore, with respect to possible serious infringements provided for in the Securities Code.

14. Apursing the rigor of the performance of the Insurance Institute of Portugal

in the detection and enquiring of any serious wrongdoing which, under the law, may have been committed by financial institutions, in the relative to the management of the portfolio of the respective pension funds, particularly in connection with illicit activities conducted by these vehicles off shore;

15. Detect and propose legislative initiatives that in the future

enhance the effectiveness and results required for supervisory authorities, which establish corporate governance rules ( corporate governance ) in line with international benchmarks, which clarify the nature of serious and very serious banking and financial ilitals, and to strengthen the fines provided for in the respective schemes against ordinances for them to be passed effective deterrents of these ilocytes.

The foundation of the indispensability of the constitution of this Parliamentary Committee of Inquiry finds itself in the essentials explained in the rigorous and detailed characterization of its object. Such an explanation guarantees another essential foundation, that is, that by confining itself to its object, the Parliamentary Committee of Inquiry guarantees that it will not interfere in any way, in acting

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of the supervisory authorities and of the judiciary, within the scope of the fact-finding processes currently under way, subject to the duties of secrecy in the legal terms. On the other hand, by carrying out its object, the Parliamentary Committee of Inquiry will positively contribute to strengthening the reputation and credibility that it currently enjoys the national banking and financial system. Palace of Saint Benedict, February 28, 2008

The Deputies of the PSD Parliamentary Group,