SEC: Imposition of administrative fine of €100k to HB
3/11/2014 14:21
The Board of Directors of the Cyprus Securities and Exchange Commission would like to inform the investing public that at the meeting held on October 20, 2014 it decided to impose an administrative fine of 100,000 to Hellenic Bank Public Company Ltd for violating:
(1) Article 130 of the Securities and Stock Exchange Law of 1993, as in force (L.14 (I) / 1993)
(2)Article 41 of the SEC Law of 2009, as in force (Law 73 (I) / 2009)
on the acquisition and the announcement of the acquisition of land in Amathus area, Ayios Tichonas, Limassol ('the property'), by the Holy Archbishopric of Cyprus, which is an associated person (to it).
Analytically, the Company was imposed an administrative fine of:
(1)€40.000 for violating Article 130 of L.14 (I) /1993 as, with the acquisition of the property in March 2012, it did not act to ensure equal treatment of shareholders, since it served the interests of the Archbishopric of Cyprus and not the interests of all shareholders, that the Company had no real need to acquire this property.
To determine the administrative fine in relation to the breach of article 130 of L.14(I)/1993, it took into account the following factors:
- The seriousness that the legislature gives in such violations, which is reflected by the amount of the administrative penalty provided for such violations.
- The central importance attributed by the Commission in ensuring equal treatment of shareholders of a company, which contributes to the confidence of the investing public.
-The amount paid by the Company for the acquisition of the property, which it was high for its size - The €15.500.000 paid for the acquisition of the property corresponding, during the year, to 25% of the €66.000.000 that the Company needed to cover the increased supervisory requirements related to its basic equity (Announcement dated 30.3.2012).
-As a mitigating factor, the fact that no goodwill was paid by the Company for the acquisition of the property.
(2) €60.000 for violating Article 41 of L.73 (I) / 2009 as, the information provided by the Company through the announcement dated 23.03.2012 for the purchase of the property and the purpose of the acquisition, was misleading as to an essential element because the Company had no real need to acquire such land.
To determine the administrative fine in relation to the violation of article 41 of L.73(I)/2009, the following factors were taken into account:
- The seriousness that the legislature gives in such violations, which is reflected by the amount of the administrative penalty provided for such violations.
- The great importance attached to the fact that the information provided by natural or legal persons, are valid, accurate, and complete to ensure the proper functioning of the market. The misleading information affects investors’ confidence and prevents the smooth operation of the market and creates conditions of full transparency.
- The misleading statement in this case concerned a transaction with an associated person, which, taking into account the explicit obligation imposed by law for the announcement of such transactions, is expected to demonstrate responsibility for its content and the information provided to investors.
- The amount paid by the Company for the acquisition of the property, which was high for its size- The €15.500.000 paid for the acquisition of the property corresponded, during the year, to 25% of the €66.000.000 that the Company needed to cover the increased supervisory requirements related to its basic equity (Announcement dated 30.3.2012).
(1) Article 130 of the Securities and Stock Exchange Law of 1993, as in force (L.14 (I) / 1993)
(2)Article 41 of the SEC Law of 2009, as in force (Law 73 (I) / 2009)
on the acquisition and the announcement of the acquisition of land in Amathus area, Ayios Tichonas, Limassol ('the property'), by the Holy Archbishopric of Cyprus, which is an associated person (to it).
Analytically, the Company was imposed an administrative fine of:
(1)€40.000 for violating Article 130 of L.14 (I) /1993 as, with the acquisition of the property in March 2012, it did not act to ensure equal treatment of shareholders, since it served the interests of the Archbishopric of Cyprus and not the interests of all shareholders, that the Company had no real need to acquire this property.
To determine the administrative fine in relation to the breach of article 130 of L.14(I)/1993, it took into account the following factors:
- The seriousness that the legislature gives in such violations, which is reflected by the amount of the administrative penalty provided for such violations.
- The central importance attributed by the Commission in ensuring equal treatment of shareholders of a company, which contributes to the confidence of the investing public.
-The amount paid by the Company for the acquisition of the property, which it was high for its size - The €15.500.000 paid for the acquisition of the property corresponding, during the year, to 25% of the €66.000.000 that the Company needed to cover the increased supervisory requirements related to its basic equity (Announcement dated 30.3.2012).
-As a mitigating factor, the fact that no goodwill was paid by the Company for the acquisition of the property.
(2) €60.000 for violating Article 41 of L.73 (I) / 2009 as, the information provided by the Company through the announcement dated 23.03.2012 for the purchase of the property and the purpose of the acquisition, was misleading as to an essential element because the Company had no real need to acquire such land.
To determine the administrative fine in relation to the violation of article 41 of L.73(I)/2009, the following factors were taken into account:
- The seriousness that the legislature gives in such violations, which is reflected by the amount of the administrative penalty provided for such violations.
- The great importance attached to the fact that the information provided by natural or legal persons, are valid, accurate, and complete to ensure the proper functioning of the market. The misleading information affects investors’ confidence and prevents the smooth operation of the market and creates conditions of full transparency.
- The misleading statement in this case concerned a transaction with an associated person, which, taking into account the explicit obligation imposed by law for the announcement of such transactions, is expected to demonstrate responsibility for its content and the information provided to investors.
- The amount paid by the Company for the acquisition of the property, which was high for its size- The €15.500.000 paid for the acquisition of the property corresponded, during the year, to 25% of the €66.000.000 that the Company needed to cover the increased supervisory requirements related to its basic equity (Announcement dated 30.3.2012).
