Cyprus Mail
Business Cyprus

Court of appeal sets June 26 deadline for cross appeal by FBME, depositors

The supreme court in Nicosia

The owners of FBME Bank Ltd as well as its depositors have a June 26 deadline to challenge by cross-appeal, certain parts of proceedings at the Nicosia District Court which last month rejected the application of the Central Bank of Cyprus to appoint a liquidator, the Cyprus News Agency (CNA) reported on Monday.

The CNA citied the three-member court of appeal of the Supreme Court which reviewed the central bank’s request for a speedy process, the CNA reported.

The Central Bank of Cyprus which revoked the licence of FBME’s Cyprus branch and fined it €1.2m for failing to comply with the anti-money laundering law in December 2015, initially placed the Tanzanian lender under administration and subsequently under resolution after US authorities described the lender as a financial institution of primary money laundering concern in July 2014. In April 2016, the central bank also triggered the deposits guarantee scheme to compensate depositors with up to €100,000.

The rejection of the central bank’s request for the appointment of a liquidator by the Nicosia district court last month – on the grounds that it did not serve the public interest – came a week after the Bank of Tanzania, which supervises the mother bank revoked the licence of FBME and appointed a liquidator itself. The Tanzanian liquidator is expected to appear in a Cypriot court on June 20, to request recognition of his appointment by Cypriot authorities.

On Monday, the Paris-based arbitration court of the International Chamber of Commerce began reviewing the application of the owners of FBME against the Republic of Cyprus. The bank’s shareholders who initially demanded €500m in damages citing Cyprus’s failure to protect their investment, have increased their demands in the meantime to €1.5bn.

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