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Deutsche Bank, HSBC to evaluate options for Laiki’s BoC stake

The Resolution Authority continues to evaluate strategic options with respect to the 9.6 per cent stake of the defunct Laiki bank, in Bank of Cyprus, the Central Bank said.

“The London Branch of Deutsche Bank AG and HSBC Bank plc have been appointed in relation to the strategic options in question” as advisers, the Central Bank said in a statement on its website on Friday, days after BoC announced more details about its planned listing on the London Stock Exchange.

As part of Cyprus’s 2013 bailout terms, Laiki went into resolution and its non-Greek assets were absorbed by BoC, initially in exchange for an18 per cent stake, which was later diluted to 9.6 per cent. BoC pursues the London listing to increase its share visibility. It already announced the establishment of the BoC holding company that will facilitate the London listing.

A banking source, which spoke on condition of anonymity, said the appointed advisers will inform the resolution authority about “available options” and the possible timing or “timeline” of disposing the stake.

“The sale of Laiki assets, including IBG (Investment Bank of Greece), has been always under consideration,” the source added. “However, the IBG will remain last on the list as these sales are carried out through it and it cannot sell itself”.

Sykala, a group representing Laiki creditors, including depositors who lost all their uninsured deposits in March 2013, have been complaining over the past year over the steady drop of the value of the remaining assets in Laiki’s possession.The latest setback was the decision of Russia’s central bank to withdraw the licence of Laiki’s Russian unit, Rosprombank, which was infiltrated by the Russian mafia.

Adonis Papaconstantinou, a Sykala member, said in October that the value of Laiki assets dropped from €900m in March 2013, to below €300m.

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