Portugal's last banking dynasty: The fall of Espirito Santo

Founded more than a century ago as a humble money-changing office in Lisbon, the Espirito Santo family's fall from grace has seen Portugal's last banking dynasty collapse in a matter of weeks.
Portugal woke on Monday to find a new bank had been born from the ashes of Banco Espirito Santo (BES), which was plunged into crisis when allegations of fraud exposed a huge debt hole in its parent group.
Novo Banco, as the new company has been baptised, will be given a 4.9 billion euro ($6.6 billion) capital injection backed by Lisbon and the EU, and will house all of BES's existing viable assets.
BES will remain as a so-called "bad bank", which will house the banking giant's toxic assets, including its exposure to the troubled Espirito Santo business empire as well as its Angolan subsidiary.
- End of family empire -
The breakup of the bank marks the public collapse of the Espirito Santos' family empire, which through the course of its 150-year lifetime survived wars, dictatorship, revolution and deep family feuds.
Last week BES reported a first-half loss of 3.57 billion euros, the worst ever in Portugal, sending shivers through financial markets and sparking fears of a resurgence of the eurozone's debt crisis.
The bank's 70-year-old veteran head Ricardo Salgado, who led BES for 23 years before leaving his post in June, was arrested in connection with money laundering and fraud allegations last month.
Salgado was forced from office after the Espirito Santos lost their controlling stake in the bank after its second rights issue in two years.
But while BES formed the basis of the family's huge fortune, estimated at some 3 billion euros, it was the vast network of holding companies that sowed the seeds of their downfall.
The family's woes came to light in May, when an audit ordered by the Bank of Portugal found irregularities at parent group Espirito Santo International. The conglomerate and four units have since filed for creditor protection.
Now the company may be forced to sell off a vast array of assets, including luxury hotels, insurance, real estate, tourism and health stretching across five continents.
- Started from money exchange shop -
The Espirito Santo dynasty, Portugual's last major banking family, began in 1869 when Jose Maria Espirito Santo founded a currency exchange in Lisbon where he bought and sold securities and lottery tickets.
The bank was nationalised after the fall of Portugal's dictator in 1975 and several of the founding family members went into exile, including to Brazil, Switzerland and Britain, to lick their wounds and rebuild their empire.
In 1991, the bank was privatized and once again handed over to the Espirito Santo family, thanks to an alliance with the Credit Agricole.