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Cyprus

Former BoC CEO says bank could have recapitalised

Former Bank of cyprus CEO Andreas Eliades

Former Bank of Cyprus (BoC) CEO Andreas Eliades said on Tuesday an extension of the deadline to cover a capital shortfall in 2012 would have allowed the lender to complete its recapitalisation.

Eliades said state assistance was always on the cards if the bank failed to cover the entire shortfall.

“State support was the alternative solution,” he told the Nicosia criminal court.

Eliades along with BoC former board chairmen Theodoros Aristodemou and Andreas Artemi, former CEO Yiannis Kypri, and former deputy CEO Yiannis Pehlivanides, are facing market-manipulation charges in connection with their failure to inform the public from June 14 to June 26, 2012, that the lender’s capital shortfall, announced the previous month at €200million, was in fact more than double that.

BoC, Eliades and Aristodemou also face separate charges of misrepresenting the worth of the lender’s financial holdings to shareholders in the June 19, 2012 AGM. The two former executives are also accused of withholding key information from shareholders regarding the capital shortfall.

On Tuesday, Eliades denied being against seeking state assistance, adding that other actions – sale of insurance companies, issue of convertible bonds – were also in the pipeline to cover the shortfall.

He suggested that the European Banking Authority (EBA) could have quietly agreed to a few months’ extension. Anyway, he said, the EBA did not ask anyone to come up with the shortfall immediately.

Eliades said the board in general felt that the capital shortfall could have been covered without state assistance “and that was our effort.”

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