29/11/2013 11:39
We recognize the size of the task and we will do all in our power and experience to restore the Bank to strength, Bank of Cyprus CEO, John Hourican stated.
Speaking to the Annual General Meeting of the bank, referring to its priorities, he said “we must tackle the very high level of arrears and non-performing loans”.
“This can only be done through engaging directly and intensely with our customers and changing the way we operate. Our customers, from the very largest corporates through to our retail borrowers, need to recognize that the bank will not recover if we do not receive interest and capital repayment on outstanding loans. This will be an area of deliberate and clear focus over the coming weeks and months. It is an essential foundation for the recovery of our Group and, by extension, the Cyprus economy”, he noted.
“We are, of course, sympathetic to the fact that some of our customers face real economic challenges and we will work with them to find viable solutions where possible”, he added.
“We will focus on maintaining our Capital Adequacy and ensuring that our solvency throughout this journey is understood and managed. Our decisions on ownership, sale and structuring of our business interests will have an eye to ensuring we maximize solvency and balance sheet strength so as to strengthen the foundations of trust, encouraging Cyprus’ consumers and businesses to place their deposits in our care once again”.
According to John Hourican, the Group’s international footprint has been reduced, while operations in Cyprus, and exposure to the Cypriot economy, have been significantly increased. With the Cypriot operations accounting for about 85% of Group loans and deposits, respectively, the Bank’s future financial performance and strength is therefore highly correlated with the economic activity in Cyprus.
“Post the restoration of the Group’s status as an eligible counterparty at the ECB, the Group’s reliance on ELA funding has reduced by E1.3 billion to E9.8 billion and replaced with more normal ECB funding”, he stressed.
“We are reliant on the Government implementing the reforms agreed with the Troika and we are, to a degree, a hostage of the economic trajectory of Cyprus. A deeper and more prolonged recession with all the consequent impacts on unemployment, real estate markets and customer confidence can be detrimental to our delivery”, Mr. Hourican concluded.
Speaking to the Annual General Meeting of the bank, referring to its priorities, he said “we must tackle the very high level of arrears and non-performing loans”.
“This can only be done through engaging directly and intensely with our customers and changing the way we operate. Our customers, from the very largest corporates through to our retail borrowers, need to recognize that the bank will not recover if we do not receive interest and capital repayment on outstanding loans. This will be an area of deliberate and clear focus over the coming weeks and months. It is an essential foundation for the recovery of our Group and, by extension, the Cyprus economy”, he noted.
“We are, of course, sympathetic to the fact that some of our customers face real economic challenges and we will work with them to find viable solutions where possible”, he added.
“We will focus on maintaining our Capital Adequacy and ensuring that our solvency throughout this journey is understood and managed. Our decisions on ownership, sale and structuring of our business interests will have an eye to ensuring we maximize solvency and balance sheet strength so as to strengthen the foundations of trust, encouraging Cyprus’ consumers and businesses to place their deposits in our care once again”.
According to John Hourican, the Group’s international footprint has been reduced, while operations in Cyprus, and exposure to the Cypriot economy, have been significantly increased. With the Cypriot operations accounting for about 85% of Group loans and deposits, respectively, the Bank’s future financial performance and strength is therefore highly correlated with the economic activity in Cyprus.
“Post the restoration of the Group’s status as an eligible counterparty at the ECB, the Group’s reliance on ELA funding has reduced by E1.3 billion to E9.8 billion and replaced with more normal ECB funding”, he stressed.
“We are reliant on the Government implementing the reforms agreed with the Troika and we are, to a degree, a hostage of the economic trajectory of Cyprus. A deeper and more prolonged recession with all the consequent impacts on unemployment, real estate markets and customer confidence can be detrimental to our delivery”, Mr. Hourican concluded.
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