Probe into Cooperative Bank to examine both pre and post 2013 period, says President

The probe which the government has requested into the Cyprus Cooperative Bank will look into matters before and after 2013, President Nicos Anastasiades said on Thursday.

In statements before a lunch, in Nicosia, hosted by the Embassy of Bulgaria in Cyprus ahead of the conclusion of the EU Bulgarian Presidency, the President clarified that the probe will look into what happened in 2013, that led the government to support the financial institution with Euros 1.5 bln in order to survive.

At the same time, the President said that developments in the 2013-2018 period will also be examined, which resulted in Euros 7.5 bln non-performing loans.

Referring to the acquisition of the Cyprus Cooperative Bank by the Hellenic Bank following recommendations to the government by the European supervisory authorities for the liquidation of the Cooperative Bank, the President said that we were obliged to take a painful decision which protects depositors, stabilizes the banking system and creates future prospects.

The President called for the adoption of efficient measures, in line with European Commission requirements in order to address the problem in an efficient and positive manner.

Asked if there can be a balanced approach to avoid problems that emerged in other countries, for example with foreclosures, the President said that no doubt, the protection of those who are really unable to pay comes first in our mind. He said however that the approach towards those who are taking advantage of the situation even though they are able to pay will be different.

Invited to comment on a possible delay by the banks in their effort to deal with NPLs, President Anastasiades indicated that the banks could have handled the situation better, taking into account that those loans will at some point be worth nothing.

He also indicated that the banks could have been more flexible to allow the borrower to pay his loan.

The President expressed hope that the measures that will be adopted by the political parties will acknowledge obligations vis-A�-vis the European Commission and lead to a stable banking system.

The government of Cyprus approved a deal on the Cyprus Cooperative Bank, following an offer submitted by the Hellenic Bank.

According to the offer, Hellenic Bank undertakes to pay the whole amount of the clients’ deposits worth Euros 9.7 bln and assumes assets of Euros 10.3 bln, including loans, bonds and cash as well as non-performing loans of Euros 0.5 bln. Assets of the Cooperative amounting to Euros 8.3 bln will be taken over by the state, most of which is non-performing loans.

Source: Cyprus News Agency