NICOSIA - Finance Minister Haris Georgiades on Monday called on the Central Bank of Cyprus to speed up the process of evaluating the 16 new directors of Bank of Cyprus.
He said any further delays in the smooth operation of the island’s biggest lender which exited resolution status in July were both unnecessary and damaging.
“I was under the impression that the evaluation would have been completed before the annual general meeting…then I was told that they needed a few more days after the new board was voted in,” Georgiades told state radio.
“And now I hear the process is still going on. But this delay is both unnecessary and costly. We have no time to lose, we have to kick-start the economy, we need the Bank of Cyprus back on track,” he added.
The 16 new directors – six of whom are Russians – were elected last week after a very tense annual general meeting.
But two could fail the ‘fit and proper’ evaluation test by the Central Bank which issued a statement over the weekend saying it needed a few clarifications and additional information from a couple of members.
Letters were expected to be sent to two newly-elected directors yesterday, according to finance website Stockwatch.
One is believed to have been proposed by the Church of Cyprus – a main old share holder of the bank – and the other is a Russian.
A very angry Archbishop Chrysostomos has already slammed the CBC saying his candidate was more than fit and was a very strong leader.
And he sent the message that the Archbishopic would not take no for an answer.
An additional two executive directors will soon be appointed to the board.
And the evaluation of CBC will be taken before the island’s Troika of international lenders who bailed out Cyprus in March when it teetered on the brink of financial meltdown.
Nicosia debated onerous terms of a bailout with the EU, ECB and IMF.
BoC was forced to convert large deposits to equity to avoid collapse.
Shareholders lost considerable amounts of money in the forced conversion of 48.5 percent of deposits exceeding €100,000.
It had to also absorb collapsed Laiki Bank, the second biggest lender, whose shareholders now own 18.1% - the biggest stake.
Board chairman is University of Cyprus professor Christis Hasapis and deputy chairman is Russian businessman Vladimir Strzhalkovskiy.
He is a former KGB official thought to be an ally of Vladimir Putin and ex-CEO of Norilsk Nickel - the world's largest nickel and palladium producer.
Ironically, one of the main criticisms from European paymaster Germany was that the island could be a conduit for money laundering from Russia because of close business ties.