Volume was also significantly less, at about €600,000 in afternoon trading, a third of the previous day, when investors were offloading their bailed-in equity to pay off debts or to raise cash in the dried up economy.
A total of 8.9 billion shares were re-listed on the CSE and the ASE on Tuesday, about 3.8 billion of which represents shareholders whose deposits were written down by 47.5% and exchanged for equity last year to rescue the bank.
A further 4.2 billion shares are in the hands of institutional investors who pumped in €1 billion in August and do not plan to sell at the current depressed levels, far below the 24c at which they bought the new shares. Some 859 million shares are held by ‘Legacy Laiki’, the administrators of the defunct Laiki Popular Bank, that forcibly merged into Bank of Cyprus as part of the €10 billion bailout programme for Cyprus last year and 5.8 million shares represent junior bond owners who also saw their holdings converted to equity.
On Tuesday, the stock opened at 24c and quickly went downhill ending at 18c in Cyprus and 17.7c in Athens, with about €3.8 million worth of shares traded in both markets.
Finance Minister Haris Georghiades, commenting on the State Budget for 2015 that was approved by parliament on Tuesday night, said that the recovery of the banking sector was one of the main pillars for economic growth.
He said that the return of the BOCY shares was a decision of the bank and the regulatory bodies.
“This is yet another step towards stability and a return to normalcy,” Georghiades said.
“My personal view is that in the medium term, the share prices of the banks will reflect their own favourable prospects, as well as that of the economy,” he said.
At a 25% loss on the first day, the stock stayed clear of the CSE’s 30% limit-down price band mechanism that will not be affected until after three days of trading.
Also, the CSE will not include BOCY in the weighting of its All Share Index for ten consecutive trading days, which means that the bank’s shares have until about January 7 to stabilise and possibly move up, so as not to drag the Index down with it.
Source: Financial Mirror