Representatives of major shareholders of the new Bank of Cyprus met the Central Bank yesterday, but there was no decision on the names to be nominated for the board to be elected next month.
Despite expectations to the contrary, specific names were not proposed, and the talks on the future of the bank which exited resolution last month will continue on Tuesday.
Insiders told The Cyprus Daily that the meeting was constructive. “The good thing is that no one expressed any intention of wresting control.”
At the same time, ruling Disy yesterday cried foul that the island’s supervisory authority has got involved in the board’s selection process.
“It is totally unethical and probably mischievous to have the Governor of the Central Bank of Cyprus being involved in the selection process of a body that he will be called on to supervise,’’ said Disy MP Prodromos Prodromou.
Prodromou, who is an economist by profession, wondered how the Governor will apply rules and regulations as well as European Instructions based on how fit the members of the administrative board are. “Considering that he, personally, was part of the selection process,” he said.
Central Bank boss Panicos Demetriades also held talks yesterday with the uninsured depositors of ‘bad Laiki’ – the island’s second biggest lender which was wound up in May and the ‘good’ part absorbed by BoC.
Laiki depositors hold an 18% stake – the biggest in the new-look BoC - and this is in the hands of Laiki Administrator Andri Antoniadou who is certain to get a set on the board. But Laiki’s uninsured depositors are demanding a more substantial representation on the board.
Spokesman Adonis Papaconstantinou said: “We don’t just want to hand a list of names, we want to hand sound enough proposals aiming towards a high-quality board composition… the majority of board members should be independent, anyway, according to the (bailout) memorandum.”
He added: “In other words, if the board is made up of 13 members, seven of them should be independent.”
Local legal firms are estimated to represent 12-15% of Russian and Ukrainian clients who lost large amounts of cash after the Eurogroup decision in March.
A place on the Board is also being claimed by large provident funds such as that of Bank of Cyprus as well as of Cyprus Telecommunications Authority (CyTA) which jointly hold a 7% stake in BoC. Another issue raised yesterday between the Central Bank and shareholders was whether interim CEO Christos Sorotos should stay in that position after September 10’s EGM.
He reportedly wants to keep the position so as to implement the bank’s ambitious restructuring plan. Deliberations are expected to continue until September 5, when the nominations for the new board will be announced.