PM reveals compensation plan for investors of collapsed Portuguese bank

Portuguese Prime Minister Antonio Costa announced a plan on Monday to compensate commercial paper investors hit by the collapse of bank Banco Espirito Santo(BES).

BES clients will recover between 50 percent and 75 percent of the money they invested, which will come from the country's bank resolution fund, Costa said.

"It is a solution which does not totally eliminate losses, but minimizes them," Costa told BES clients in an official speech at his official residence in Sao Bento, Lisbon.

The bank had to be split into a "good bank" and "bad bank" after undergoing losses of 3.6 billion euros(3.74 billion U.S. dollars) in August 2014.

The government had to inject around 4.9 billion euros into the bank, which was followed by protests and legal action by retail customers.

At least 4,000 customers, who had invested around 485 million euros, were affected by the bankruptcy.

The president of the association representing commercial paper investors affected by the bank's collapse, Lacerda de Machado, said he was happy with the government's solution and said there was a "genuine spirit of collaboration". Enditem