Bondholders who lost money during Cyprus’ banking crisis said on Sunday they would step up measures for compensation but called off a mass protest planned outside the finance ministry in Nicosia until President Nicos Anastasiades returns from abroad.
The bondholders held a meeting on Sunday in Chlorakas in Paphos. They want to be compensated to the tune of €100,000 “in a manner to be agreed” in line with the deposit guarantee scheme extended to bank customers but without compromising their right to have all their money returned.
The bondholders group represents thousands of investors who lost around €700m when the Bank of Cyprus and Cyprus Popular Bank, or Laiki, bonds were wiped out in March 2013.
The head of the Bondholders Association Phivos Mavrovouniotis, in his speech on Sunday referred to a meeting between himself and Anastasiades in May this year and that the president had given assurances that he would discuss ways to compensate bondholders with party leaders. But, he said, they have heard nothing since.
Mavrovouniotis said that after the lapse of several months, the finance ministry contacted him to inform him that it had not gotten any instructions from the president.
“The [finance] minister’s message was forward it to the president to finally see who is lying and who is telling the truth,” he said. That was why the protest was postponed.
But he urged members of the association to attend any protest events organised by them
“We finally all understand that without dynamic actions we will not win our fight,” said Mavrovouniotis
“The minister of finance touts around the world that ‘foreigners should not worry because in Cyprus there are no protest events. It is time to disappoint him,” he added.
Many of the political parties have put forward proposals on how to compensate the bondholders or have said they would support a bill doing so, Mavrovouniotis said.
A finance ministry source told the Cyprus Business Mail recently that it was currently looking into how to rehabilitate provident funds affected by the bail-in with an unspecified amount, but that compensating bondholders was not on the agenda.
Bank of Cyprus, which absorbed Laiki’s operations in March 2013, has repeatedly rejected compensating bondholders without however, ruling out exceptions related to “humanitarian cases”. The bank told bondholders to pursue legal recourse.
Mavrovouniotis said that many of the association’s members cannot afford the financial cost of legal action against the bank, adding that even if they had the means, it would take up to ten years for the courts to adjudicate such cases.