articles | 31 October 2013

Bank of Cyprus confident it can support economy

Bank of Cyprus top brass are optimistic about the lender’s future, but non-performing loans are a key challenge to tackle to restore confidence.

The Bank of Cyprus (BoC) board was expected to go over the restructuring plan with international lenders earlier this week. “BoC already has a CEO, we have closed our accounts for 2012 and in 15 days we are closing our six-month accounts,” BoC chairman Christis Hassapis said after the board met President Nicos Anastasiades. The lender has prepared a restructuring plan, 'the bible' of how BoC will operate in the next five years, “thus we think we are doing well. Bank of Cyprus will support the Cypriot economy,” Hassapis said.

“We are working on the restructuring plan with the Central Bank, which examines the changes we make on a daily basis. The changes are approved; there is no problem whatsoever and you should consider the plan’s approval certain,” Hassapis said.

Bank of Cyprus (BoC) reported record losses of €2.3 billion for 2012 on a surge in non-performing loans as a crippling recession impacted people’s ability to repay debts. John Hourican, a former RBS senior executive appointed CEO of Bank of Cyprus last week, said the issue of non-performing loans was among the most pressing issues at the bank.

“This is an unprecedented situation that has happened to Cyprus and to the Bank ofCyprus and I think that, while the problems are actually quite clear, the solutions are as of yet untested, and not clear to me given that I haven’t yet taken full possession of the job,” Hourican said. He fully assumes his duties on Monday. “I wouldn’t have taken the job if I didn’t think we can make a difference and I look forward to engaging with all of you and with the lawmakers and everyone in Cyprus over the course of the coming years, I will be moving here and I look forward to moving to Cyprus and trying to make a difference not just for the Bank but also for the country,” Hourican said.

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