Treasury line for storm-affected companies rises to €1 billion
From the storm to a liquidity crisis
In the early hours of 27 to 28 January 2026, storm Kristin swept through mainland Portugal with a violence that left deep marks on homes, farms, road infrastructure and, most significantly, the business fabric. Flooded warehouses, damaged machinery, shops closed due to power cuts: economic normality was suspended overnight in dozens of municipalities.
Given the scale of damage, the Government convened an extraordinary Council of Ministers meeting that resulted in an emergency and recovery package valued at €2.5 billion. Among the decisions, two credit lines were created under the Portuguese Development Bank (BPF), with an initial global value of €1.5 billion, specifically designed to meet the immediate needs of businesses located in calamity areas.
How does the treasury line work?
The Reconstruction Support Line (Treasury) was designed to guarantee immediate liquidity to companies, cooperatives and other collective entities operating in affected areas. Its purpose is clear: to cover urgent current needs such as salary payments, raw material procurement and the replenishment of working capital essential for operational continuity.
Framed within the BPF Reconstruction Support programme, the line benefits from a 70% public guarantee and offers favourable financial conditions: five-year maturity and a 12-month grace period. Applications are processed through commercial banks acting as intermediaries, and €100 million of the total allocation can be converted into non-repayable grants.
Additionally, there is a Reconstruction Support Line (Investment), with €1 billion, a 10-year maturity and 36-month grace period, for rebuilding facilities and equipment. This line immediately covers 100% of damages validated by independent assessment, with insurance payments deducted from the loan amount. After the 36-month grace period, companies that maintain operations, employment and insurance coverage may benefit from an additional subsidy of up to 10%.
Demand exceeds all forecasts
Demand proved far higher than expected. Just days after applications opened, the volume of requests already exceeded the initial €500 million ceiling. On 11 February, the Development Bank CEO confirmed in Parliament that over 2,000 companies had already applied, for a total of €627 million.
On 12 February, during a visit to Alcácer do Sal, Prime Minister Luís Montenegro confirmed that the Council of Ministers had approved the doubling of the ceiling from €500 million to €1 billion that same day.
The latest figures, released on Wednesday 18 February by the coordinator of the Central Region Reconstruction Mission, Paulo Fernandes, confirm the scale of demand: 4,310 applications to the treasury line totalling €905 million, approaching the new €1 billion ceiling. The investment credit line has received 106 applications worth €55 million.
A broader economic response package
The credit lines are part of a wider set of business support measures. The Government also approved 90-day banking moratoriums for loans to companies in calamity areas, with the possibility of a 12-month extension in cases of deeper damage. On the tax front, obligations due between 28 January and 31 March can now be fulfilled by 30 April 2026.
An exceptional regime waiving prior administrative controls for reconstruction works was also created to accelerate economic recovery. Under COMPETE 2030, extensions to project execution deadlines were authorised to safeguard the continuity of investments affected by the storms.
Critical outlook: challenges ahead
Not all voices applaud the adopted model without reservations. The CGTP-IN expressed concerns about the imbalance between resources made available to businesses and support provided directly to workers and families, also warning of the risk that large companies may benefit disproportionately compared to micro and small enterprises.
The Prime Minister was clear about the role of private insurance, calling on insurers to be swift with assessments: "The State cannot and should not replace insurers who must assume their responsibilities."
The horizon: PTRR and long-term resilience
Portugal was hit by three successive depressions - Kristin, Leonardo and Marta - since late January, leading to calamity declarations in nearly 70 municipalities, mainly in the districts of Leiria, Coimbra and Santarém.
On 12 February, Montenegro announced the creation of the Portugal Recovery and Resilience Plan (PTRR), an exclusively national programme funded by the State Budget, aiming to prepare the country to face extreme weather events more robustly.
The treasury line, now reinforced to €1 billion, is one of the most visible instruments of this promise - but its real effectiveness will depend on how quickly funds reach the businesses that need them most.
If your company was affected by the storm and needs accounting or tax support to access these credit lines, talk to us. The Grupo Your team is ready to help you through the entire process.
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