Cyprus Mail
Business Cyprus

BoC’s message was: we’re doing great, court hears

By Angelos Anastasiou

A statement issued by the Bank of Cyprus on May 10, 2012, with regard to its capital needs sent the message to investors that “we are doing great”, Cyprus Securities and Exchange Commission (CySEC) official Alkis Pieridis said on Wednesday, taking the stand as a prosecution witness in the trial of the lender and five of its former top officials.

During Wednesday’s hearing, Pierides was grilled on the safeguards put in place by the commission, as well as the procedure followed by the CySEC, in investigating cases of market manipulation.

“In order to have a smoothly functioning securities market, market abuse must be pre-empted,” Pierides said.

“There are mechanisms in place to combat market abuse so that smoothness, integrity, and investors’ trust in the markets, is restored.”

Asked to comment on a statement issued by the Bank of Cyprus on May 10, 2012, Pierides said that the lender had announced that its capital needs did not exceed €200 million, in light of its anticipated profits by June 2012. The bank’s capital shortfall was to prove wildly underreported only months later.

“The statement sent the message to investors that ‘we are doing great’,” he said.

Wednesday’s session was interrupted after the defence objected to the submission of a document, the legality of which they contested as far as its procurement by the prosecution was concerned.

The court will announce its ruling on the objection on Wednesday, and set October 8, 12, 13, and 22 as hearing dates.

The Bank of Cyprus, former board chairmen Theodoros Aristodemou and Andreas Artemis, former CEOs Andreas Eliades and Yiannis Kypris, and former deputy CEO Yiannis Pehlivanides are facing charges of conspiracy to defraud investors and market manipulation by failing to disclose the true picture of the lender’s capital needs in 2012.

The charge sheet includes 33 witnesses for the prosecution, including former Finance minister and top BoC official Vasos Sharly, former Central Bank vice-governor Spiros Stavrinakis, and other BoC and Central Bank officials.


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