articles | 21 April 2015

BoC chief Hourican steps down

Bank of Cyprus Public Group Chief Executive Officer, John Hourican, is stepping down at the end of August 2015, having completed nearly two years at the helm of the struggling-to-recover bank.

The news came as a bombshell as it coincided with the bank’s return to normalcy, having been forced to seize unsecured deposits as part of the bail-in plan in 2013, then forced to absorbed failed bank Laiki and now facing a mountain of failed mortgages after parliament passed the long-overdue framework on foreclosures and insolvencies.

On a personal level, Hourican also faced a lot of angst and frustration, primarily from depositors who saw their savings disappear into thin air under the previous management, and pre-crisis shareholders who saw their stake diminish to less than half a percent of their original holding.

More recently, one of the cars used by his personal staff, was burned in an arson attack, which both the bank and police tried to play down as being unrelated to the on-going crisis that is blamed on all bankers in general.

The board announced that “Hourican’s decision to leave the Group is a personal one and he intends to relocate to his home country, Ireland,” adding that it “will discuss in due course issues arising from the resignation, including the issue of succession. He indicated that he is not leaving to take up another role elsewhere.”

Hourican, who was headhunted from Royal Bank of Scotland and took the wheel of the troubled bank in November 2013 with aim of restructuring it (downsizing) and returning it to stability, came on during an extraordinarily difficult chapter in its history. Today, the bank is much better positioned to serve its customers, to offer opportunity to its employees and to create returns for its shareholders. The bank has a clear strategy. The integration of with Laiki Bank is complete. Good progress has been made in selling and de-risking overseas businesses. The deposit base has stabilised and the bank has begun to make progress with its non-performing customers.

ELA funding has been dramatically reduced, and more importantly, €1 billion of fresh equity has been raised to ensure that the bank is well capitalised amongst its European peers.

In a memo to the staff Hourican said: “I have been very proud to be part of the Bank of Cyprus family during this period and to have led this chapter in the bank’s rehabilitation.”

Board Chairman Dr. Josef Ackermann praised “the remarkable progress achieved under John Hourican’s leadership. He leaves behind a strong management team and a bank in a steadily improving financial shape, with restored employee, investor and customer confidence. We wish him all the best in his future endeavours and we are looking forward to continuing to work with him in the months ahead.”

Last week, the bank announced the appointment of veteran finance expert Michael (Mikis) Hadjimichael as Senior Advisor to Chairman Ackermann.

For the past four years, Hadjimichael was Deputy Director of Capital Markets and Director of Emerging Markets Policy at the Institute of International Finance (IIF), the worldwide association of financial institutions based in Washington DC and before that he had a 28-year career at the International Monetary Fund, also in Washington DC.

Source: Financial Mirror

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