In full page ads in the local press this week to mark one-year since the Central Bank decided to suspend the operations of FBME Bank on the basis of as yet unproven allegations of money laundering, FBME sets out the context of the dispute and makes practical recommendations to resolve it.
In its message, aimed at letting the public know what had happened and to alert them to the repercussions of the actions, as it says, of a handful of officials, it asserts that there is a way out of this “dilemma”.
The move comes at the end of a week of confrontational public statements by the two sides in which FBME responded to the Central Bank’s assertion that it had sought to reach an optimum solution as soon as possible, stating that it was completely unaware of any initiatives or signals from the Resolution Authority pointing, instead, to a culture of procrastination and confusion.
With pressure mounting on the Central Bank to act and with the case still pending before the Paris based ICC Arbitration Court with potentially ominous repercussions for the Republic, FBME claims that the actions set in motion on 17 July 2014 have had serious consequences for customers, employees and affiliates of FBME Bank, both in Cyprus and abroad.
Crucially, it says, the reputation of Cyprus as a centre for banking and investment has been tarnished while serious questions have been asked of the justice system and the competence of financial regulators. Latterly, taxpayers, the government, banking authorities and the justice system of Cyprus have begun to feel the impact.
From that day in July 2014 to this, claims FBME, the Resolution Committee’s actions remain what they were a year ago: unexplained, unprofessional, vindictive and possibly the product of a conspiracy.
FBME says action is needed now as senior officials in the CBC are “paralysed by a series of scandals, only one of which concerns FBME”.
Repeating its willingness to cooperate with CBC officials FBME suggests that:
There should be a prompt agreement between the executive management of FBME and the CBC on a programme for re-starting the Bank and FBME Card Services. This should occur as a priority.
There should be full cooperation in continuing the relationships with FBME’s correspondent banks.
The findings of all investigations conducted by and on behalf of the CBC, should be released together with the report of the Resolution Committee.
The CBC and executive management of FBME should cooperate honestly and actively for the resumption of services from Reuters, Bloomberg and Euroclear.
Meaningful communications based on mutual respect should be established with the Bank of Tanzania and its agents, and FBME owners and managers.
FBME is also eager to renew its cooperation with the Cyprus authorities to restore confidence in the Republic’s banking sector and return to playing its part in rebuilding the economy of the country. None of these important first steps should be problematic, FBME maintains, and concludes: “We wait to hear from the Central Bank”.