Attracting investor interest for Cooperative Bank a must, Financial Ombudsman says

Attracting investor interest for the Cyprus Cooperative Bank is a must and a move everyone should contribute in, in order to shield the Cypriot economy, Financial Ombudsman Pavlos Ioannou has said.

Addressing the Property Show, on Saturday, Ioannou said that accumulated non-performing loans are not just a result of the economic crisis but also a creation of the behaviour of the Cooperatives main structure According to him this is why immediate action is needed.

Cooperative credit institutions are no longer cooperative, he said.

The Financial Ombudsman, who also expressed his approval of a move by the Ministry of Finance to attract investor interest for the Cyprus Cooperative Bank, in statements yesterday, said the ministry’s recent steps constitute well thought out and clever moves” which apart from having shielded the system from various uncertainties and insecurities will create the basis for the privatisation of the Cyprus Cooperative Bank.

In his address he also noted that everyone should contribute in the effort to have a successful outcome, which would in turn mean that they are contributing in shielding the Cypriot economy.

Under the pressure from the EU Single Supervisory Mechanism (SSM) to raise provisions against bad loans depleting its capital, the CCB launched on March 19 a privatisation process offering potential investors two options, either acquiring the whole banking entity or acquiring its performing operations and a part of its banking network or its non-performing loans amounting to Euros 6.2 billion which amount to 60% of its total loan book.

Cyprus bailed out the CCB in 2014 injecting Euros 1.5 billion of capital using loans it received by the EU and the IMF as part of the Euros 10 billion financial assistance programme. In 2015 the government injected an additional Euros 0.17 billion to boost the CCB’s capital.

In December 2017 the CCB’s capital amounted to Euros 1.1 billion.

Source: Cyprus News Agency