President Nikos Christodoulides and Finance Minister Makis Keravnos are in constant contact with the governor of the Cyprus Central Bank as of Thursday, following a 30 per cent slump in shares of Credit Suisse bank in Switzerland.

Following Wednesday’s steep drop, which intensified fears of a global banking crisis fanned by the collapse of two mid-sized US lenders – Silicon Valley Bank and Signature Bank – the Swiss bank decided it would tap a lifeline of up to $54 billion from the Swiss authorities to shore up liquidity and investor confidence.

According to CNA, the president and the finance minister are in constant contact with Central Bank governor Constantinos Herodotou over the matter that unfolded with the Swiss lender.

Herodotou is currently at a conference in Frankfurt at the European Central Bank.

Reports from CNA said that Herodotou assured both the president and Keravnos that he is in contact with the Cypriot banks, who have said that they are not exposed to the Swiss institution.

Hellenic Bank CEO Oliver Gatzke said that supervisors had asked if there was a risk and he assured that there is no cause for concern.

Speaking at an event about the bank’s 2022 results, Gatzke said that nothing can compare to the 2013 financial crisis in Cyprus, where deposits were slashed in an effort to save the system from collapse.

He said that the big difference since 2008 is that banks in Europe and Cyprus have significantly strengthened their capital ratios and liquidity ratios, thanks also to stricter supervision.

“Look at banks today compared to ten years ago, there is capital, there is great liquidity and when you look at Hellenic Bank there is even more capital and even more liquidity,” he said.

He added that supervision has been beneficial for the bank and that it has made the Cypriot banking system is more developed.

Gatzke highlighted the very different model followed by Hellenic Bank and the Cypriot banking system in general compared to that of the American Silicon Valley Bank, which collapsed due to the departure of deposits from startups and venture capitals.

Hellenic Bank mainly has domestic retail depositors with the majority of them being insured deposits (up to €100,000), he said.

“It doesn’t compare to 2013 where a large part of the deposits came from abroad,” he added.

He also noted that the bank has a total of €6 billion in Central Bank deposits, which can be immediately liquidated.

As he said, the liquidity coverage ratio is at 440 per cent compared to the supervisory limit which is at 100 per cent.

Christodoulides also gave instructions on the issue of the fund for securities holders and depositors involved in the 2013 ‘haircut’ and the issue of the unemployment of the bank employees, who left with the last voluntary exit plan, which the government is expected to bring to parliament with a bill.

Finally, he also met with the general director of Structural Reforms of the European Commission, Mario Nava.