Portugal’s central bank rescues Banco Espírito Santo

Bank of Portugal announced a rescue plan for Banco Espirito Santo on late Sunday. According to the rescue plan, a bad bank will be set up with toxic assets from the lender, including the loans given to Espírito Santo entities that could be unrecoverable. Under the €4.9 billion ($6.6 billion) plan, depositors and senior bondholders will be spared, while subordinated creditors and current shareholders of the bank will be in line for losses.