Workers at the Cyprus branch of FBME Bank decided to end their strike and return to the job, a month after the Central Bank of Cyprus triggered the depositors deposit scheme, a spokesman for the staff said.

“Staff voted to lift the strike and to suspend protest activity from 9 May 2016 in order to minimise disruption to FBME Bank and its depositors,” the spokesperson said in an emailed statement on Monday.

The decision followed a re-negotiation of a previous agreement by the striking workers and their colleagues who were dismissed in March, with the Central Bank of Cyprus’s Resolution Authority leading to “a revised proposal of action,” the statement said.

Chris Iacovides, the special administrator at FBME, appointed by the Central Bank of Cyprus, said that while workers have “ended their protest,” returned to work and are following his instructions, “no renegotiation of anything took place”.

He said that the workers can claim the immediate disbursement at the court, as he already encouraged them to do on May 4.

The workers’ statement said that “whilst there are still steps that need to be taken by all parties, a quick and orderly resolution to the ongoing dispute is now anticipated”.

“By ending the strike and the protest before their rights are satisfied in full staff are demonstrating their goodwill and commitment to a solution,” they said. “Staff expect the authorities to show the same goodwill and spirit of cooperation and trust that they will act for the best interests of all the affected parties”.

Last week, Iacovides rejected demands for the immediate payment of the workers’ loyalty scheme in excess of €12m, saying that the amount was not a privileged obligation. The two sides had earlier agreed that the administrator would disburse €3.5m to the workers representing their notice until dismissal, remaining vacation and thirteenth salary, benefits to pregnant workers and mothers in maternity leave and three quarters of their bonus.

Today’s staff statement gave no further details. Lawyer Stephanos Skordis who represents their interests said that following the latest round of talks with the central bank, there was understanding that the workers will have to seek a court order to force the administrator immediately pay them their loyalty scheme.

The Financial Crime Enforcement Network, a division of the U.S. Treasury, reaffirmed in March its decision to ban American banks from opening or maintaining correspondent accounts with the Tanzanian bank, which it described as “primary money laundering concern”.

By Stelios Orphanides (Cyprus Mail)

Nicosia insisted on Monday that as long as Turkey does not fulfil its obligations to the EU, including Cyprus, visa restrictions for Turkish nationals cannot be abolished, even as Brussels was set to drive forward with the deal this Wednesday.

The European Commission is widely expected to rule that Turkey has broadly met the conditions despite the fact that, according to the Financial Times, nine of the 72 conditions are still outstanding.

A senior EU diplomat belittled any suspense around the conditions, telling Reuters: “This is just a joke. We have already made the decision.”

Government spokesman Nicos Christodoulides told public broadcaster CyBC on Monday that all prerequisites must be met to abolish visas for Turkish citizens visiting EU countries.  “There can be no different treatment for any member state,” he said.

Among these criteria, he said, was the visa-free travel of Greek Cypriots to Turkey in the same manner as any other EU citizen.

If Ankara, continued its tactics in not recognising the Republic of Cyprus and did not comply, “visa restrictions for Turkish citizens cannot be removed”, Christodoulides added.

On Wednesday, the European Commission is to present member states with the third assessment on Turkey’s compliance with the 72 criteria which will be then discussed at national level.

The final say, Christodoulides said, lies with the European Council, but the approval of the European Parliament is required, since the adoption of the abolition of visas is a legislative act.

He added that Nicosia was assessing developments on a daily basis, and that there had been some meetings already on technocratic level.

According to sources cited by the CyBC correspondent in Brussels, nothing has changed as regards the EU’s position, in that Turkey would not receive special treatment when it came to its obligations. It said however that those concerning Cyprus were expected to be discussed at a later stage.

DISY leader Averof Neophytou said on Monday it would not be easy for Turkey to fulfil the 72 prerequisites. “It is not a matter of a few weeks,” he said.

The problem, he added, was not Cyprus “but whether the Germans or the French would ever accept such a decision under which 80 million Turks would move freely within Europe”.

Cyprus, Neophytou said, was the “alibi” for some countries within the EU who are “possibly being accommodated on various issues”.

“As regards our relationship with Turkey, our positions are clear. Turkey has very clear obligations towards Cyprus. If Turkey behaves responsibly and assists in practice to a just solution of the Cyprus problem, we will cease to have problems with the neighbouring country,” he said.

“As long as Turkey does not recognise the Republic of Cyprus and does not act in a way that is conducive to achieving a speedy solution of the Cyprus problem, it should not look forward to Cyprus’ support on any issue, be it opening of chapters, or visa-free travel,” Neophytou said.

The Financial Times (FT) reported on Sunday that nine of the 72 criteria had not been fulfilled and that an updated report would be issued in mid-June on those still pending.  The move is part of a crucial deal with Ankara to stem the migrant flow to Europe.

The FT said the aim now was to put pressure on Ankara “to rush through the measures before the European Parliament and EU member states vote on final approval in late June”.

As part of the deal, the FT said, Turkey must also issue visa waivers to 11 EU countries and drop discriminatory measures against citizens of Cyprus. “This is expected through a decree that comes into force once Turkish visa rights are granted,” the FT reported.

The most difficult of the unmet conditions, the FT said, include bolstering Turkey’s data protection rules to cover certain security agencies, revising terrorism legislation to better protect minority rights and anti-corruption measures that would increase transparency on political funding in Turkey.

“This is all a nightmare,” one diplomat involved in talks told the FT. Another European diplomat described the Turkey-EU deal as carrying “the seeds of its own destruction”.

The FT reported that France and Germany had called for a wide-ranging “emergency brake” to be attached to the Turkey deal, so it can be revoked under certain circumstances. “Although some in the commission are open to the idea, it will not be included in the legal proposal in case it appears as if additional special requirements are being required of Turkey”.

Turkish legislation to meet European Union criteria on visa liberalisation will be completed on Monday, Turkey’s minister for EU affairs, Volkan Bozkir said last Thursday.

Bozkir also told broadcaster NTV he expected the EU Commission to recommend the lifting of visas for Turks travelling to Europe in a report this week.

A Reuters report from Brussels on Sunday said that despite deep public misgivings in some countries, the EU would drive forward with the plan.

“We have not lowered our standards. Turkey has raised its game,” a senior EU official familiar with the negotiations told the news agency.

He was seeking to explain how the EU executive could certify compliance after telling lawmakers just two weeks ago that Ankara had met fewer than half the so-called benchmarks.

The political reality is that Brussels cannot say “No” and risk a collapse of a much criticised March 18 EU-Turkey deal that was a turning point in Europe’s migration crisis, Reuters said.

“It may lack political support to sustain a “Yes”, but the Turkish government won’t take “Later” for an answer,” it added.

“So in the time-honoured EU manner, the Commission will present a package aimed at offering something for everyone.”

Turkish Prime Minister Ahmet Davutoglu has warned that Ankara would stop implementing its side of the bargain to take back all those who reach Greece from its shores if Europe does not deliver on what he calls its commitment.

EU officials insist the union made no promise, and the offer applies only if Turkey meets the 72 legal and technical conditions.

“This is a great opportunity for Europe to show it is a reliable partner and make it clear that they don’t apply double standards when it comes to predominantly Muslim European nations such as Turkey,” a government official in Ankara said.

Sceptics in the European Parliament and key member states such as France, Germany and the Netherlands, where there is substantial public opposition to opening borders to more Turks, insist they will examine Turkey’s compliance with a microscope.

“There will be no refugee discount,” said Manfred Weber, leader of the centre-right group in the European Parliament from German Chancellor Angela Merkel’s Bavarian sister-party.

“We’ll look cool-headedly in parliament at whether Turkey has fulfilled the conditions for visa liberalisation.”

Officials and diplomats say there is huge pressure to push visa liberalisation through, notably from Germany, which was the main destination for about a million refugees and migrants who entered the EU last year and would be among the first to suffer if the accord with Turkey broke down.

To make acceptance more politically palatable, Germany and France this week proposed tougher safeguards to allow any EU state to suspend visa-free travel from any country for six months in case of a sudden increase in asylum requests, overstays or readmission refusals.

Turkish EU ambassador Selim Yenel told Reuters his country could live with that provided Turkey was not singled out.

“Apparently, the Franco-German proposal aims at appeasing the possible fears of some EU nations and perhaps make it easier to win the support of some members states,” Yenel said.

“We are not worried about these proposals but believe that the current safeguards are sufficient already.”

EU officials and diplomats believe no member state will ultimately halt visa freedom for Turkey, recalling that all 28 EU leaders signed up to the agreement with Ankara in March.

They are a bit less sure about the European Parliament, which can be a law unto itself.

Turkey has not made the decision easier by prosecuting critical journalists at home, arresting or barring some foreign reporters, and demanding that Germany prosecute a television satirist for insulting President Tayyip Erdogan.

Courtesy of Cyprus Mail

FBME Bank said on Sunday that the Central Bank of Cyprus (CBC) had triggered the deposit guarantee scheme so that the supervisory body could claim to have fulfilled its duties to depositors “and evade further exposure for misconduct”.

The CBC announced on Saturday that after taking note of its own findings, FBME Bank Ltd-Cyprus Branch did not appear at present able to return deposits to customers for reasons directly related to its financial situation “and believes that it will not be able to do so in the near future, has proceeded to the activation of the Deposit Guarantee Fund for Banks and will pay compensation to the beneficiaries of FBME BANK Ltd-Cyprus Branch”.

But FBME said the activation of the scheme was designed to protect the CBC, not depositors

Following “a series of unilateral, illegal, arbitrary and irresponsible actions” by the CBC, the announcement, the bank said, came 21 months after the Resolution Authority and the CBC acted against FBME and at the end of “a protracted period where the Special Administrator choked depositor access to funds on the instruction of the CBC for the expressly stated purpose of maintaining sufficient funds in the bank to repay the Deposit Protection Scheme”

“The funds that CBC rely on have been in their possession for more than a year and the circumstances that would have permitted depositors to access the Deposit Protection Scheme have existed for a considerable time,” FBME said. “It is incorrectly stated that the economic condition of FBME is the reason for activation. The truth is that funds are available but the CBC’s mishandling of the situation has starved depositors of access to funds.”

The Special Administrator of the Cyprus branch of FBME who was appointed by CBC in January, on March 31 delivered signed redundancy notices to 136 FBME staff in Cyprus, covering the major part of the remaining employee base of the bank on the island. The bank says this is being challenged in court, as is its liquidation.

The move to dismiss staff followed a ruling on March 25, by FinCEN, a unit of the US treasury, reaffirming its July 2014 decision to prohibit US banks from opening or maintaining correspondent accounts of or on behalf of FBME, a Tanzanian lender, which it described as a financial institution “of primary money laundering concern”.

FBME in its statement on Sunday questioned whether depositors had been treated equally and correctly by the regulatory authorities in Cyprus. “Is the position of depositors better now than it would be if correct measures had been taken from 21 July 2014?” it said.
“Any observer of CBC actions over the past year will notice three consistent traits: lack of transparency, lack of responsibility, and lack of technical competence,” the bank said.

“The answer to the depositors’ questions is that they have not been treated equally; the Deposit Protection Scheme is being triggered so that CBC can claim to have fulfilled its duties to depositors and evade further exposure for misconduct; and the intervention of the CBC and the Resolution Authority has had a negative impact on depositors. The consistent lack of competence of CBC needs no further comment,” it added.

It said depositors would already have noted that CBC and the Resolution Authority were liable in law to them at this point in time. “By taking action now, CBC seeks to create a fait accompli situation rendering moot any decision of the courts in the upcoming liquidation action and designed to obscure and evade their liability to all relevant parties that arises from the action over the past year and a half. Depositor protection has clearly not been the priority for CBC at any point,” the bank said.

According to the CBC announcement, the maximum compensation amount for each depositor will be €100,000, and the amount will be decided by the committee, depending on each person’s deposits but also on their obligations toward FBME bank.

The committee will accept applications for compensation as of Monday.

For more information, depositors of FBME BANK Ltd-Cyprus Branch may call 22 714100, 22 714570, 22 714572 as of Monday. Office hours 11am until 1pm and from 3.30 pm to 5pm.

The special administrator appointed by the Central Bank of Cyprus informed most of the staff of FBME Bank, which had its licence revoked in December, that their employment will be terminated effective on April 1, a source said.

“Since the bank’s license has been revoked and the decision of Financial Crimes Enforcement Network was issued, expenses have to be reduced to a minimum,” the source familiar with the matter said.

On March 25, FinCEN, a unit of the U.S. treasury, reaffirmed its decision to prohibit U.S. banks from opening or maintaining correspondent accounts of or on behalf of FBME, which it described as a financial institution “of primary money laundering concern”.

Of a total 161 staff members, “around 30 will continue working for the bank provided they want to”, in order to keep “the status quo unchanged” in anticipation of the court’s ruling on the central bank’s application to liquidate the bank and appoint a “criminal liquidator,” the source added.

Affected workers were already paid their salary for March and will receive “any other benefits they were entitled to according to the law,” the source added.
“It is unlikely, following FinCEN’s decision, that the bank will operate again and resume its operations as its situation is irreversible,” the source said.

The central bank appointed in July 2014 an administrator at FBME. The bank operated as a subsidiary of Tanzania’s FBME Bank.

By Stelios Orphanides

European Parliament President Martin Schulz who is due in Cyprus on Monday night has sent the message that Cypriots would not be left alone the day after reunification, and said the EU presented the best guarantee for a prosperous and bright future in the context of a federal Cyprus.

In an interview with CNA, ahead of the visit, Schulz said he had no doubt that even though a settlement of the Cyprus problem was within touching distance, there was still work to be accomplished and efforts to be made after an eventual unification. “The international community and the EU must be ready to help out wherever this is beneficial,” he said.

Schulz is visiting Cyprus at the invitation of House President Yiannakis Omirou. He will arrive Monday evening and leave on Wednesday. During his visit he will be received by President Nicos Anastasiades and will also address the House plenary. He will also meet Turkish Cypriot leader Mustafa Akinci and party leaders on both sides.

“Cypriots face some crucial months ahead of them. The chance for reunification has never been so close. Never been so tangible. I will be visiting Cyprus to show the support of the European Parliament to the process being undertaken and publicly back both President Anastasiades and the leader of the Turkish Cypriot community Akıncı in the considerable efforts they are doing,” he said.

“Keeping the momentum going will be essential and I believe that apart from receiving the helpful verbal support of the international community, Cypriots and their leaders can benefit from direct backing on the ground. In this line, I will also be seeking to see with the different actors in what way the European Parliament can best help the process.”

Schulz said the the efforts being made by all sides to resolve the division in Cyprus were nothing short of remarkable and the speed and depth of the talks was impressive.

He also sees an invigorated role for a post-solution Cyprus “because it will be the leading example in the EU that deep seated divisions can be overcome through diplomacy with patience and perseverance.”

In a time where the “us” against “them” culture was becoming more dominant, a post-solution Cyprus could provide a counterbalance and a much needed breath of fresh air for Cypriots, for the EU and for the whole Mediterranean region, he noted.

Asked if he agreed that Cyprus` EU membership constitutes adequate guarantee for the security of the country and its people after a solution, the EP President said: “One of the recurrent reasons that sovereign nations have advocated for joining the EU has been that the peace and stability of that country are served better inside the EU. I see no reason why this would not be the case also for a united Cyprus.”

On how the European Parliament could support efforts for a Cyprus settlement, Schulz said that with his visit he wanted to convey to Cypriots a message of hope. A political message from the European Parliament that Cypriots would not be left alone the day after reunification, and that the EU presented the best guarantee for a prosperous and bright future for all Cypriots in the context of a Federal Cyprus.

“The international community and the EU must be ready to help out wherever this is beneficial,” he added.

Schulz underlined at the same time that the substance of what is negotiated must be Cypriot-led and owned. “We must give the necessary space to both leaders to go their way and finalise negotiations, as soon as possible, without imposing any technical deadlines for the conclusion of these negotiations. What is fundamental is to ensure that this time around we succeed to get two `Yes` votes in the simultaneous referenda for the approval of the sought after agreed settlement plan,” he said.

Commenting on Cyprus’ upcoming exit from its bailout programme, Schulz said Cyprus was to be highly commended. “In three years the country has gone from an economy in meltdown with all its eggs in one basket to one on a clear path of recovery. Reforms have been undertaken speedily which will help make the economy more resilient and also help in diversification,” he noted, adding that this rapid recovery shows that effort and persistence pay off,” he said.

He stressed, however, that there should be no complacency. “Reforms must continue, notably to reduce the high ratio of non-performing loans, but also to further reform the public administration and move ahead with the privatisation of the Cypriot Telecommunications Authority. Moreover the establishment of a fairer tax system should also be an important goal to pursue,” Schulz concluded. (CNA)

By Maria Koniotou

If Cyprus’ veto on opening EU-Turkey chapters jeopardises a deal between Ankara and Brussels to stem the migrant flow, which is due to be finalised next Thursday, it would not be Nicosia’s problem, President Nicos Anastasiades said on Friday.

Speaking after his regular meeting with Turkish Cypriot leader Mustafa Akinci, Anastasiades was asked to comment on what Turkey needed to do to have the freeze on certain chapters lifted. He said Ankara would have “to respond to its obligations deriving from the Negotiating Framework.”

Pressed as to the implications for the EU’s migrant deal if Ankara did not comply, Anastasiades added: “This is not our problem, because we have never been asked. Those who have put forward this issue should undertake the task of obliging Turkey to respond to its obligations on the basis of the Ankara protocol or on the basis of the Negotiating Framework,” he said.

Earlier in the day, the president used even stronger language in an interview published by the Financial Times (FT).
He said he would ‘”never accept” being forced to consent to the opening of the frozen chapters.

The newspaper said Europe’s plan to stem the refugee crisis negotiated by Germany’s Angela Merkel could be scuppered by Cyprus if Anastasiades fails to agree to the opening of chapters, which Turkey has laid down as one of its demands for a deal to be discussed again next week in Brussels, following on from last Monday’s summit.

Anastasiades told the FT he has come under intense pressure from other EU countries to remove Cyprus’s longstanding “freeze” on five policy areas.

“I will never accept being forced, and I will never give my consent, because otherwise I have no other choice but to not return back home,” Anastasiades said.

Anastasiades said he could not lift the freeze unless Ankara lived up to its commitments to normalise relations with Cyprus as an EU member state. This would involve Turkey implementing the Ankara protocol that would include opening up Turkish ports and airports to Republic of Cyprus air and sea traffic.

Turkish Prime Minister Ahmet Davutoglu was quoted by the FT as saying:  “This [deal] has caused a fight within the EU… they were really forced to turn on the Greek Cypriots in a serious way.”

Anastasiades said that if he would concede to Turkish demands now, without receiving previously-agreed concessions from Ankara, Greek Cypriots would abandon their support for the reunification talks, “ending years of sensitive work”.

“Unfortunately, I could say they are putting in danger the whole procedure. They are sacrificing the unique opportunity to find a solution to the Cyprus question by putting us in such a difficult position,” he said. “It’s a very delicate moment, and at this very crucial moment, they are pushing us into a position to say ‘no’ to Turkey.”

According to officials who participated in the talks, the FT said, Anastasiades was informed about the Turkish demands by Mark Rutte, the Dutch prime minister who accompanied Merkel in her talks with Davutoglu — not Donald Tusk, the European Council president who had been leading EU negotiations with Turkey for weeks but had been cut out of Merkel’s negotiations, the paper said.

The FT said that like most EU delegations, Cypriot diplomats were blindsided by Merkel’s deal with Davutoglu at Monday’s summit. “In particular, they said the issue of opening new chapters was not raised in meetings in the days leading up to the summit — including a session with all 28 EU ambassadors less than 24 hours before it began,” the paper said.

According to the FT, diplomats said the two sides may be able to find a compromise short of Turkey formally recognising the Greek Cypriot led Cyprus government if Ankara were willing to allow Cypriot-flagged ships to dock in Turkish ports.

Anastasiades also indicated in the interview that Cypriot officials feared Ankara may have begun  withdrawing support from Akinci’s diplomatic outreach, and added that he would ask EU leaders to put pressure on Turkey to back Turkish Cypriot initiatives.

“Mr Akinci has exhausted his limits,” Anastasiades said.  “That’s why I’m asking the Turkish government not just to encourage but also to support Mr Akinci, because he’s facing problems.”

On his meeting on Friday with Akinci, Anastasiades said it had been positive and constructive.

“I think it was a very productive and creative meeting. We have decided that the understandings [we have reached] should be gradually transformed into convergences and we will certainly continue the talks in the same intensive way in order to achieve what will meet the expectations of both communities,” the president said.

Asked which chapters were discussed, he added: “We have covered a host of issues relating to the topics under discussion, excluding none, “except of course, the territorial adjustments and the guarantees.”
Akinci had raised the issue of leaks from the Greek Cypriot side relating to the ongoing negotiations.

Anastasiades, on his return to the presidential palace after the talks, said he had told Akinci it was a matter for the Greek Cypriot side to deal with.

Pressed to comment further, he said it was a matter he did not wish to further address at the moment.  On Thursday night in an interview with CyBC Anastasiades said he was weighing up his options when it came to National Council meetings and suggested he might even switch to briefing the party leaders one-on one instead.

He also said, in response to a question that Tusk might visit the island but did not elaborate.

Courtesy of Jean Christou

A Monday meeting between the Ministers of Transport and Energy with representatives of energy giants Total, ENI and Noble, culminated in the decision for a technical committee to record the needs of the oil and gas companies, in moving the firms from Larnaca to Limassol as a base of operations. Special arrangements for Total within 10 days of the meeting are to be made, given the firm’s tighter drilling time window.

The meeting was held on Monday at the Transport ministry, to discuss the energy firms’ moves from Larnaca port to Limassol, after last week’s marginal vote by Larnaca Municipal Council against granting the companies an extension of operations at the town’s port.

Following Monday’s meeting, Transport Minister Marios Demetriades and Energy Minister George Lakkotrypis stressed the need to find a permanent solution to avoid further inconvenience to the oil and gas companies, with the technical committee projected to wrap up its task within a few weeks.

Time was more pressing in serving Total, though, given that the French energy firm had scheduled drilling at Plot 11 by the end of August. Special arrangements would thus be made to expedite Total’s operations.

“What was decided together with the companies is to create a technical committee which, together with the firms, would examine what areas they would require (for their operation), as well as their respective schedules, so as to find the best possible solution in serving the hydrocarbon industry,” said Demetriades.

Asked whether the companies had expressed the intention to abandon Cyprus, the Transport Minister said the matter had not been raised. What was important was to find a permanent solution for the companies to obviate further inconvenience to them that would in turn necessitate further meetings.

Minister Demetriades said the technical committee would have to wrap up its findings regarding the firms’ needs within the next few weeks, but had up to 10 days to do the same for Total.

For his part, Lakkotrypis stressed that each energy firm’s needs were different, as were their preferred timelines for operations.

According to the Energy Minister, Noble and ENI’s schedules were less stringent and more longer term than Total’s, not to mention that Noble’s needs were not limited to drilling alone, but encompassed those arising from its development of the Aphrodite field. As for ENI, its upcoming drilling operations were scheduled for 2017, he said.

ENI and Total will invite tenders for third-party firms to facilitate the move to Limassol, whereas Noble will handle the move itself, noted Lakkotrypis.

Insiders had earlier argued that both Total and ENI could consider setting up a base in neighbouring countries such as Egypt or Israel if Cyprus became too difficult a prospect, logistically.

But Demetriades had told the Weekly last week that: “we don’t want to push away any oil and gas company, of course we want them to stay and work from Cyprus … Limassol port is more than happy to accommodate them, the facilities are there.

Larnaca Council’s ‘No’ vote last week was the result of 13 votes against, 12 in favour, one abstention and one absentee.

Councillors of main Opposition left-wing Akel joined forces with those of centre Diko and socialist Edek to kick the energy companies out of Larnaca. Ruling Disy was all in favour of the extension.

The council’s negative vote was sparked by protests from activists who have opposed any industrial activity.

Bank of Cyprus said that it will post an after tax loss of €0.4bn for 2015 caused by an increase in provisions for impairment of customer loans by €0.6bn in October to December to a total of €1bn for the year, adding that it will need no additional capital.

“The bank has made changes to its provisioning assumptions taking into account the ongoing regulatory dialogue with European Central Bank, bolstering its provision coverage levels,” the lender said in an emailed statement on Tuesday in reference to the supervisory review evaluation process, widely referred to as SREP.

Bank of Cyprus’s board decided by taking into account the methodologies of existing international financial reporting standards, “to make certain amendments to the assumptions in the bank’s provisioning methodologies,” the lender said. “These changes relate to extending recovery periods and applying additional realisation discounts on certain portfolios of problem loans. Provisions are a highly judgmental area under international financial reporting standards”.

The bank’s core equity tier 1 ratio is thereafter “expected to remain strong at approximately 14 per cent,” the island’s largest lender said and thus “the bank does not need to raise additional capital” as the ratio is higher than the minimum required ratio of 11.75 per cent.

“The bank continues to make good progress in delivering against its strategic objectives,” Bank of Cyprus said. “During the fourth quarter of 2015 and during January 2016, the Bank completed the restructuring of a number of large lending exposures. This is expected to result in a €0.7bn reduction in 90 days past due (loans) for the fourth quarter of 2015,” which is a 6 per cent drop compared to the quarter before.

The banks said that the increase in liquidity resulting from “continuing deposit inflows” which resulted in a quarterly increase of customer deposits by €0.6bn, or 4 per cent, helped it reduce its reliance on emergency liquidity assistance from the ECB by €1.4bn since September 30 to currently €3.5bn.

Bank of Cyprus added that “these changes will significantly bridge the regulatory dialogue with the ECB and explicitly bolster” its provisional levels. “Provision coverage levels against the bank’s loans in arrears for more than 90 days will improve to levels approaching 50 per cent”.

Bank of Cyprus’s statement came three weeks ahead of the official announcement of its 2015 earnings. In January to September 2015, the lender generated an after tax net income of €73m.

By Stelios Orphanides

Attorney General Costas Clerides has confirmed that a paper trail suggests that Cyprus’ two biggest parties benefited from undeclared financial contributions totaling a combined €1.48 million from Greece but said it did not constitute a criminal offence.

Speaking to reporters on Wednesday, Clerides said that current ruling party Disy appeared to receive a cash injection – both directly and indirectly – from several companies – including Focus Maritime Cooperation totaling around €600,000 while opposition party Akel may have benefited, indirectly, from a cash contribution of €881,430.

The payments are alleged to have been made in the run-up to the 2008 Presidential Elections in Cyprus which was ultimately won by Akel-backed Demetris Christofias.

“It should be noted that these transactions do not constitute a criminal offence,” said Clerides. “The probe was conducted to satisfy the public interest whilst there was also a need for transparency. The case is not closed.”

The money, the attorney general added, appeared to have been primarily used to fund the air travel of Cypriot students from Greece to Cyprus to vote in the elections.

When commenting about the alleged contributions to Akel, Clerides said, “The only link that Akel benefited from this money is from the police statements from a handful of passengers that were tracked down from a passenger list.”

One person implied that Akel paid for the ticket while others mentioned that it was paid for by Akel-affiliated student group Proodeftiki. But there was no hard evidence to implicate Akel which has always denied the allegations.

Vgenopoulos contribution?

Clerides also mentioned the statement by well known developer Miltiades Neophytou – a former friend of Christofias before the two had a public falling out over financial differences – who was on the fund-raising election campaign committee for Christofias. Neophytou claimed that controversial banker Andreas Vgenopoulos  gave Akel a €2 million contribution.

Other committee members – including two Akel MPs – declined to give a statement but denied any connection between the campaign and Vgenopoulos or Focus.

Rumours of money funnelled to the two most influential political parties in Cyprus by Focus Maritime – with the implication that Vgenopoulos of defunct Marfin Laiki Bank was behind the donations in order to secure favourable treatment from the political establishment – have been circulating since December 2013.

Ruling party Disy have admitted they accepted donations from Focus to cover 2008 presidential election expenses, but opposition party Akel are adamant the party received no Focus funds.

In a statement on Wednesday Disy said it had done nothing wrong and never tried to hide the fact it had received contributions.

Vgenopoulos as well as other bankers including ex-Laiki strongmen Efthymios Bouloutas and Kyriakos Mageiras and his firm MIG are facing criminal charges – including abuse of authority and criminal negligence – for their alleged rolein the collapse of the island’s banking sector several years ago.

All men have denied any wrongdoing with Vgenopoulos shifting the blame onto the government and accusing them of simply seeking a scapegoat in order to cover up their own failings.

Courtesy of in-cyprus

The rift between citizens and politicians is growing just a few months before the parliamentary elections while at the same time the credibility of independent institutions is enhanced. 

A new survey by StockWatch with a sample of 600 households shows a declining credibility for the executive and legislative powers and political parties. 

At the same time, an improvement is recorded in the image of the attorney general, the central bank and the courts. The reliability of the university of Cyprus and the auditor general remain high. 

As seen from the table, political parties received the lowest score among state institutions (2,1) compared with 2,3 in the previous survey while politicians were also low-rated with a 2,3. 

As in the previous survey, the university of Cyprus is considered the most reliable institution in Cyprus with a score of 7,3 out of 10 from 7,4 in May 2015. 

The rating for the auditor general reached 6,3 from 6,1 in May 2015, with the recent interventions slightly boosting his image. 

Police received a rating of 5,4 from 5,7 in May and the armed forces 5,8 as previously. 

Local authorities are given a rating of 5,4, the same as in the previous survey. 

Improvement was seen in the attorney general's office, which takes a rating of 5 against 4 in May (amid the proceedings against Rikkos Erotokritou). 

A gradual recovery is witnessed in the credibility of the central bank with a score of 3,8 from 3,5 in May 2015. 

The Cyprus house of representatives takes a rating of 3,1 out of 10 compared with 3,5 in the previous survey. 

The government was rated with 3,9 from 4,2 in May 2015. 

The ministry of finance's rating reaches 4,4 - significantly above the government and the central bank. 

The Church improved its rating from 4,4 to 4,8. 

Reliability measurements are made by RAI on behalf of StockWatch. The sample size for households was 600 people. The coverage was nationwide, urban and rural areas, men and women 18 or older. 

The methodology was multistage stratified random sampling. 

The data collection method was through telephone interviews from the call center of RAI.

The survey was conducted between 11-15 January 2016.

Courtesy Of Stockwatch Cyprus