(Adds PT demanding central bank information to recover debt, central bank reaction)
LISBON, Oct 21 (Reuters) - Portugal's CMVM securities market regulator has extended until Thursday a ban on short selling in shares of Portugal Telecom after they fell to a record low close on Tuesday.
PT shares have fallen sharply after the bankruptcy last week of Rioforte - a key holding company of the Espirito Santo banking family - raised the risk PT will not recover 900 million euros ($1.2 billion) in debt from the company.
So far this month, shares in PT, which no longer has operating assets and just holds a 26 percent stake in PT's Brazilian partner Oi and the Rioforte debt, have lost 40 percent following Tuesday's 8.15 percent fall to 1.003 euros.
The shares had already been under pressure after the resignation of Oi Chief Executive Zeinal Bava in early October and on reports that Oi could sell its Portuguese assets.
CMVM said in a statement a one-day ban it imposed on Tuesday will be extended for two more trading days in to prevent short selling - bets on a stock losing value that can exacerbate share falls.
Separately, PT demanded that the Bank of Portugal give it access to information that would identify those responsible for selling debt issued by the Espirito Santo Group that used Banco Espirito Santo (BES) as an intermediary.
In a statement, PT threatened to take legal action if the central bank continued to refuse to provide the information, which PT insists could help it recover the damage.
The Bank of Portugal said the information is covered by "secrecy rules of the supervising authority" and access can only be given under a court order.
In early August, the Portuguese authorities spent 4.9 billion euros to rescue BES, the country's second-largest lender. The bank was split into a regular bank called Novo Banco and a "bad bank" that inherited the unserviced debt of the collapsed business empire of its founding family.
Rioforte defaulted on its repayment of 900 million euros in debt to PT in July, but Rioforte's liquidation after it was denied creditor protection is likely to make it even harder for PT to recover its funds.
Oi and PT combined their assets this year but PT's bad debt investment forced a renegotiation of the terms, leaving the Portuguese company with a smaller stake.
Kepler Cheuvreux brokers cut their target price for PT to 1 euro from 1.6 euros on Tuesday, warning that it is unlikely to recover most of the Rioforte debt. (Reporting By Sergio Goncalves and Andrei Khalip; editing by Susan Thomas)