State-owned KEDIPES generates income of Euros 101 ml in first four months of operation

Cyprus Asset Management Company’s (KEDIPES) generated income of 101 million Euros in the first four months of operation of the state-owned asset manager, established following the sale of the former Cyprus Cooperative Bank to Hellenic Bank.

KEDIPES was established as a 100% subsidiary of the CCB to manage the non-performing loans, real estate and other assets amounting to Euros 8.2 billion that were not part of the transfer to Hellenic Bank, among which non-performing loans amounting to Euros 7.4 billion.

Andreas Charalambous, President of KEDIPES and Director of the Finance Ministry’s Financial Stability Division said under the circumstances, the asset manager’s results were satisfactory.

He added that the first four months of operation were a transitional phase, as KEDIPES implemented a voluntary retirement scheme, while loan restructurings were frozen as SEDIPES, KEDIPES’ parent company did not have a license to operate as a credit acquiring company.

We are seeing prospects. KEDIPES is operating in a very difficult environment but the signs say we are on track, Charalambous said, adding KEDIPES’ mandate is to maximize the value for the Cypriot taxpayer.

Furthermore, he said KEDIPES will be monitored on a monthly basis by the EU’s competition watchdog, as the sale of the CCB was subsidized with state-aid amounting to Euros 3.6 billion of which Euros 3.2 in government bonds offered to Hellenic Bank.

According to data, KEDIPES’ income from the management of NPLs amounted to Euros 28 million, whereas income from year-end loan installments by Municipalities amounted to Euros 25 million.

Income from real estate management amounted to Euros 37 million while additional other income amounted to Euros 11 million.

Total cash outflows amounted to Euros 90 million of which Euros 56 million were one-off expenses involving the first instalment of the voluntary retirement scheme amounting to Euros 43.5 million, Euros 6.6 million in deposits protection levy, and other expenses amounting to Euros 6 million.

Operating expenses amounted to Euros 34 million, of which Euros 11,3 million to Altmira asset management, KEDIPES’ loan servicer, Euros 7.7 million for staff salaries and other expenditure amounting to Euros 15 million.

KEDIPES’s cash reserves amounted to Euros 81 million, of which Euros 74 from the consideration paid by Hellenic Bank for the acquisition of the performing part of the CCB.

Lambros Papalamprianou said 2019 will be a pivotal year for KEDIPES as there will be more clarity in the income stemming from NPL and real estate management.

Source: Cyprus News Agency