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Cyprus

State-owned company told – again –  to come clean over loans to politically exposed persons

This is the second opinion on the matter issued by attorney-general Costas Clerides

The attorney-general has reaffirmed the state-owned asset management company’s (Kedipes) obligation to hand over information as part of a probe into the possibility of the former co-op bank affording favourable treatment to politically exposed persons (PEPs) in terms of loan restructuring, it emerged on Wednesday.

According to auditor-general Odysseas Michaelides, in a new legal opinion the attorney-general reaffirmed Kedipes’ duty to hand over information concerning loans belonging to PEPs that were taken over by Hellenic Bank in 2018 after a decision to shutter the co-op.

“Based on the assurances given that the opinion would be respected, we hope no new objections will be raised and the information will be handed over,” Michaelides said in a tweet.

This was the second opinion issued by the attorney-general on the issue after Kedipes had earlier declined to hand over the information in question seeking additional clarifications.

The company denied stonewalling the investigation, reiterating its willingness to fully cooperate with the auditor-general on all matters and readiness to hand over the requested information as soon as the lawfulness of its actions was ensured.

The co-op was forced to sell its operations to Hellenic Bank in June 2018 after its failure to reduce the non-performing loan stock fast enough wiped out its equity.

Kedipes was established to manage the non-performing loans, real estate and other assets amounting to €8.2bn, that were not part of the transfer to Hellenic Bank.

Among them were non-performing loans of about €7bn.

The findings of a probe into the demise of the bank said some €10m in PEP loans had been written off by the co-op bank.


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