Bank bondholders who saw their assets wiped out in the 2013 financial meltdown said on Thursday they hope that compensation payouts can finally begin next year.
They made the comments after a meeting at the palace with President Nikos Christodoulides.
Association head Stavros Yiallourides told media that the 2024 state budget will include a €50 million credit to the Solidarity Fund – initially set up immediately after the 2013 banking crisis to help recapitalise banks.
The Solidarity Fund currently has €110 million allocated to it, but as bookkeeping entry.
According to Yiallourides, by the end of the year a platform will come online where bondholders will fill out a form declaring the amount they lost due to the 2013 meltdown. The data gathered from the applications would establish an estimate of the total money lost, while the operation of the platform would “get the ball rolling” with respect to payouts.
The state itself has never accepted responsibility for the losses sustained by bondholders but has agreed to disburse moneys from the Solidarity Fund as a humanitarian gesture.
Investors who bought contingent convertible bonds issued by Bank of Cyprus and Popular Bank in the years preceding the 2013 banking crisis, lost €1.5 billion when the bonds were converted into equity.
Still, this was insufficient to prevent Popular from going out of business, while Bank of Cyprus had to convert almost half of its customers’ uninsured deposits into equity to stay afloat. Depositors at both banks lost €8 billion.
Yiallourides acknowledged that any payouts to them would be a trickle compared to the amounts lost in 2013.
But he added: “I hope in time there will be full restitution because the theft against us was perpetrated by known guilty parties. We shall accept no discounts, they have stolen from us a lifetime’s toil and sweat, money we deposited in our banks…not in the Seychelles, or Switzerland or some other exotic destination.”