Cyprus Mail
Business Cyprus

Church to abandon stake in Hellenic Bank

Archbishop Chrysostomos

By Angelos Anastasiou
THE Church of Cyprus has no interest in participating in Hellenic Bank’s planned capital raising and will be selling the rights that it owns, Archbishop Chrysostomos announced yesterday.

Last month, Hellenic announced it plans to raise €220m in fresh capital, more than double its capital needs, according to European Central Bank stress-testing.

At a little over 7 per cent, the Archbishopric is Hellenic’s fourth-largest shareholder and would require nearly €16m in order to maintain its stake.
“If we had the money, we might have invested it,” Chrysostomos told news site ant1iwo.

“We don’t, so we will probably have to sell the rights we own. We are not going to keep our stake, and we have no interest in stakes anymore.”
Formerly Hellenic’s largest shareholder, the Archbishopric was forced to introduce new shareholders after its own cash-flow issues and urgent recapitalisation needs for the lender painted a bleak picture in the fall of 2013.

A last-minute offer by online-gaming giant, hedge fund Third Point, and local investment vehicle Dimitra Investments saved the bank from nationalisation, but also meant the Church could no longer call the shots.

Earlier, the Archbishopric was hit even worse after its holdings in the island’s two largest banks – Bank of Cyprus and Laiki Popular – were wiped out when the Eurogroup decided Bank of Cyprus would have to absorb Laiki and recapitalise through a conversion of uninsured deposits, in exchange for a €10bn rescue loan to the Cyprus government.

“We have spent enough money on banks, and have suffered enough damage from all banks,” said Chrysostomos.

“I think it would be wise, at this point, to look towards other opportunities.”

Asked what “other opportunities” meant, Chrysostomos explained that the Church would seek to strengthen its businesses in other sectors.

“We have invested in the hotel industry, we hold a stake in [cement factory] Vassilikos Cement Works, another in [alcohol beverage giant] KEO, as well as plastic and metal piping factories,” he said.

Chrysostomos said the Church will focus on diverting its financial resources to its other companies, some of which are facing problems.

“The Church needs adequate financing to do its work,” he said, presumably referring to charities and helping those in need.

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