Cyprus Mail
BusinessCyprus

Recapitalisation of CDB completed

By Angelos Anastasiou

The long-awaited deal between the shareholders of the Cyprus Development Bank (CDB) and a Russian group for the recapitalisation of the lender has been finalised, a source has told the Cyprus Mail.

The bank, rumoured to have been facing hardship as a result of the adverse economic environment, slashed payroll costs last year through a voluntary exit scheme, and had gone public with investor interest from “various groups”, which has since materialised into negotiations with the Russian buyers.

But the group of the bank’s shareholders – including such heavyweights as Constantinos Shacolas, Leonidas Ioannou, and the Leventis family – have agreed the recapitalisation of the bank with Russian investors via the injection of “at least €25 million” of fresh capital into the lender.

It is understood that, as a result of the new investors’ entry, existing shareholders’ stakes in the bank will be diluted accordingly.

Reports of talks between CDB’s shareholders and a Russian group were confirmed as early as last November, culminating in the finalized deal which was announced internally to the bank’s staff.

CDB was established in 1963 as a state-owned company to promote economic development and was granted a commercial banking licence in 2001. It was sold by the government to private interests in 2008 for €75 million.

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