Cooperative bank to issue covered bond

The Cyprus Cooperative Bank announced it will issue a covered bond to be introduced in the Dublin Stock Exchange in a bid to diversify its funding base, the CCB CEO Nicolas Hadjiyiannis said on Tuesday.

The state-owned CCB said the new covered bond programme will be launched next December in cooperation with Barclays Capital. Furthermore, the CCB announced it will reduce the interest rate for short-term local institutional investors deposits to zero.

These decisions show that the CCB due to its size and as a European systemic bank follows the best practices followed by other European banks regarding the diversification of their funding, Hadjiyiannis said speaking to the press.

He added that issuing covered bonds create bigger visibility for the CCB which has assigned Citigroup as global coordinator for a capital raise scheduled for the second half of 2018.

The CCB has been nationalised as the Cypriot government injected 1.67 million in two occasions to cover its capital shortfall.

Asked if the decision to enter the Cyprus Stock Exchange, is cancelled, Hadjiyiannis said these are “obsolete news, noting that the plan has been revised.

He added that the privatisation plan has shifted to other directions more suited to the CCB plans, noting however that the privatisation plan is attached with the non-performing loan management.

Joining a stock exchange post-privatisation is always on the table, he said adding that more details for the planning taking place will be announced very shortly.

Source: Cyprus News Agency