The necessity of a well-functioning insolvency framework was pointed out by the Director of CITR Cyprus, Irina Misca, during her speech at this year’s Cyprus Banking Forum. In the presence of senior executives from the financial services sector around the island, Mrs Misca presented in detail the most important tools for an organic reduction of corporate NPLs, as well as the new European Commission Directive, that puts forward modern and streamlined insolvency rules that will facilitate restructuring, give businesses a second chance and improve the efficiency of restructuring, insolvency and debt discharge procedures.
NPLs halved from €20.6 billion at the start of 2018 to €10.3 billion at the end of the year. However, the removal of NPLs from banks’ balance sheet does not equal to their removal from the economy. Foreclosure has been the most used tool so far in Cyprus, with only 3% success rate, which showcases the need to adopt a different and more sustainable approach for a real recovery process. The new EU Directive is a great opportunity to revisit the available tools for distress and adapt the current legislation to make them work and support the local economy recover.
“To attract new investors to Cyprus, as well as keep and encourage domestic businesses operating smoothly, companies must be confident there is an insolvency system in place to equitably resolve possible disputes they may have with people or other businesses. But the effectiveness of this entire system hinges on the quality of the insolvency practitioner,” stressed out Mrs Misca.
Τhe 7th Cyprus Banking Forum took place on November 29th in Nicosia, attracting key financial services professionals, who discussed the latest developments in the banking sector and provide a commentary on today’s banking ecosystem.
With over 20 years of experience and a portfolio of managed assets worth over 650 million EURO, CITR, insolvency market leader in Romania, transferred its integrated model in Cyprus in 2018, including its innovative online sales platform with a database of over 5,000 potential buyers from 50+ countries worldwide. CITR specializes in customized solutions for businesses in economic distress, supporting them to get back on track. CITR uses innovative mechanisms and tailor-made solutions to maximize the value of the debtors’ assets, and therefore, increase the recovery rate of receivables and reduce the NPL ratio.