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ETYK issues threat over Hellenic Bank deal with APS Holding (updated)

Bank workers’ union ETYK said its members at Hellenic Bank will meet on Wednesday to discuss the lender’s intention to assign management of its bad loans to a third party and possible labour action in response.

“Affected union members will be asked to authorise ETYK’s board to further handle the issue and use all available means to resolve it, without excluding a prolonged strike,” the union said in a statement on its website. “If deemed necessary, a general assembly of the entire staff at Hellenic Bank will be held at the earliest possible. Because of the gravity of the issue, everyone’s presence is necessary”.

The meeting follows a letter sent to the bank’s chairwoman Irena Georgiadou in which ETYK asked for clarifications on the bank’s intention, including the terms and conditions under which bad loans will be managed by APS Recovery Cyprus Ltd, which the bank agreed to set up with APS Holdings s.a. The Czech holding company and the Cypriot bank will control a 51 per cent and 49 per cent stake respectively in the unit, which will also be staffed with Hellenic employees. The agreement, announced last Wednesday, is subject to regulatory approval.

ETYK also asked the bank to reveal details of the financial part of the deal with APS, including the price at which “the loans will be given to the specific company”.

Under the terms of the deal, APS will administer the €2.4bn non-performing loans of the bank which will remain in its balance sheet.

The union also asked Hellenic to reveal details of APS’s record and the names of clients it previously worked with as well as whether there have been other cases of staff transferred from banks to this type of units.

The bank assured that workers’ rights would be protected.

“The workers will be employed under the same terms as their current employment at Hellenic,” a bank spokesman said in a telephone interview. “There won’t be the slightest change in employment terms, including provident funds, benefits, or working hours. In addition, workers who will be transferred to the unit will also have the right to request returning to the bank”.

“But the bank will shut down its own recovery department,” the spokesperson said.

The Cyprus Business Mail understands that it is in the bank’s intention to respond to ETYK’s questions in writing

The looming spat is set to be yet another episode in ETYK’s struggle to maintain its position of having a say in the running of banks, which was shaken in the banking crisis four years ago.

In a similar case in 2015, Attorney-general Costas Clerides opined that the union had no say in the bank’s decision to appoint managers without consulting it, something that the union until then considered a prerogative and had been standard practice in the banking system.

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