Chairman of Cyprus Chamber of Commerce and Industry, Vasilis Rologis appealed to the Central Bank Governor on Friday to contribute to the postponement of Basel 2. Speaking at the CCCI conference on “Basel 2 and the small-medium enterprises”, Mr. Rologis requested by the CB Governor, Christodoulos Christodoulou to discuss the problems of Basel 2 with his European counterparts and transfer its enforcement next year. Basel 2 is expected to affect the granting of loans to small-medium enterprises.
“After the island’s accession in the EU, the Cyprus companies had to face a number of difficulties in their effort to deal with the EU competitors and meet the EU directives. With the enforcement of Basel 2, the access of the small-medium companies to cash will be strict. These companies need more time to adjust. For this, CCCI in cooperation with other European chambers is making every effort to delay the adoption of the measure”, Mr. Rologis said.
CB Governor: “I will review the request”
In his speech, Central Bank Governor, Christodoulos Christodoulou promised that he will promote the request. “I will examine the proposal to see the possibility of its enforcement”.
Earlier on however, Mr. Christodoulou had stated that according to surveys carried out by the Basel Committee, “the new rules are not expected to increase the capital required against the banks’ credit facilities to the small-medium companies compared to the existing rules”.
Preparations in view of the Basel 2 enforcement
Meanwhile, the Central Bank is already preparing the ground for the adoption of the new capital rules by the Cyprus banks. “The Central Bank has already on its disposal a special team, which will observe the adoption of the new directive. The Central Bank in cooperation with other European representatives is abreast of any developments. This allows us to adopt on time all necessary parameters of the new framework”, Mr. Christodoulou said.
Commenting on certain reports for money laundering in Cyprus, Mr. Christodoulou said that Cyprus must be proud of its legislation and practices. “With your help and abilities, we will succeed once again”, he told the attendants.
Basel 2
Speaking to StockWatch, CCCI Chairman, Vasilis Rologis emphasized that the business world of Cyprus must be informed on the new conditions. “We must be aware of the fact that the new rules will affect the small-medium companies”, he said.
However, the European Unions sees the adoption of the new measure from a different angle. Specifically, Economic and Fiscal Affairs Committee Secretary of the European Association of Craft, Small and Medium-sized Enterprises (UEAPME), Gerhard Huemer told StockWatch that the upcoming changes from the enforcement of Basel 2 will not affect the robust companies. “The companies must offer a better presentation of themselves”, he said.
Credit guarantees system
On the question whether the increase in capital would be the answer to the problem, Mr. Huemer said that in the long run this would be a good development. “In the meantime, however, the launch of the credit guarantee system could be a solution. The financial system should be based on the principle that the capital owners invest in companies that they trust. “Capital owners would like to have lowest possible risk”, he said.
“The system that we promote is applicable since there is a no need for high risk investments in the private sector. The launch of a system on the basis of mutuality with a state support is the answer to the challenge of Basel 2”, he concluded.
“After the island’s accession in the EU, the Cyprus companies had to face a number of difficulties in their effort to deal with the EU competitors and meet the EU directives. With the enforcement of Basel 2, the access of the small-medium companies to cash will be strict. These companies need more time to adjust. For this, CCCI in cooperation with other European chambers is making every effort to delay the adoption of the measure”, Mr. Rologis said.
CB Governor: “I will review the request”
In his speech, Central Bank Governor, Christodoulos Christodoulou promised that he will promote the request. “I will examine the proposal to see the possibility of its enforcement”.
Earlier on however, Mr. Christodoulou had stated that according to surveys carried out by the Basel Committee, “the new rules are not expected to increase the capital required against the banks’ credit facilities to the small-medium companies compared to the existing rules”.
Preparations in view of the Basel 2 enforcement
Meanwhile, the Central Bank is already preparing the ground for the adoption of the new capital rules by the Cyprus banks. “The Central Bank has already on its disposal a special team, which will observe the adoption of the new directive. The Central Bank in cooperation with other European representatives is abreast of any developments. This allows us to adopt on time all necessary parameters of the new framework”, Mr. Christodoulou said.
Commenting on certain reports for money laundering in Cyprus, Mr. Christodoulou said that Cyprus must be proud of its legislation and practices. “With your help and abilities, we will succeed once again”, he told the attendants.
Basel 2
Speaking to StockWatch, CCCI Chairman, Vasilis Rologis emphasized that the business world of Cyprus must be informed on the new conditions. “We must be aware of the fact that the new rules will affect the small-medium companies”, he said.
However, the European Unions sees the adoption of the new measure from a different angle. Specifically, Economic and Fiscal Affairs Committee Secretary of the European Association of Craft, Small and Medium-sized Enterprises (UEAPME), Gerhard Huemer told StockWatch that the upcoming changes from the enforcement of Basel 2 will not affect the robust companies. “The companies must offer a better presentation of themselves”, he said.
Credit guarantees system
On the question whether the increase in capital would be the answer to the problem, Mr. Huemer said that in the long run this would be a good development. “In the meantime, however, the launch of the credit guarantee system could be a solution. The financial system should be based on the principle that the capital owners invest in companies that they trust. “Capital owners would like to have lowest possible risk”, he said.
“The system that we promote is applicable since there is a no need for high risk investments in the private sector. The launch of a system on the basis of mutuality with a state support is the answer to the challenge of Basel 2”, he concluded.
3287.99
1275.09
