Cyprus Business Now

In a resounding endorsement of Cyprus’ burgeoning investment sector, the 36th Annual International Investment Funds Association (IIFA) Conference kicked off in Limassol on Tuesday, welcoming delegates from major Funds and Asset Managers worldwide.

Andreas Yiasemides, President of the Cyprus Investment Funds Association (CIFA), hailed the event as a vote of confidence in Cyprus’ investment ecosystem.

He highlighted the nation’s rapid emergence as one of Europe’s fastest-growing investment fund hubs, attributing this success to a harmonised regulatory framework, competitive costs ideal for SMEs, an efficient tax regime, and an extensive network of double taxation avoidance agreements.

Yiasemides expressed assurance about Cyprus’ safety as an investment destination, even amidst regional challenges, such as the volatile situation in neighbouring Israel.

Notably, the conference’s first-day speakers included George Theochorides, Chairman of the Cyprus Securities and Exchange Commission (CySEC), and Nobel Laureate Christopher Pissarides, who delved into global economic issues, their business impact, and 2024’s economic trends.

In addition to industry discussions, international delegates will have the opportunity to explore Cyprus, experiencing its culture and engaging with its people.

UniCredit and Alpha Services and Holdings this week announced a significant merger in Romania and an extensive strategic partnership in Greece, marking a substantial move in the banking sector.

Alpha Bank operates in Greece, where it serves approximately 3.5 million customers through a network of close to 270 branches, as well as Cyprus, Romania, Luxembourg and the UK.

The company has approximately 8,000 employees and a wide range of financial products across retail banking, wholesale banking and wealth management.

In Romania, UniCredit and Alpha Bank Romania have agreed to merge their subsidiaries, UniCredit Bank S.A. and Alpha Bank Romania S.A., forming the third-largest bank in the country in terms of total assets. This union cements UniCredit’s position in a key growth market, with Alpha Bank retaining a 9.9 per cent stake in the newly formed entity. The transaction is expected to conclude in 2024, contingent on due diligence, corporate approvals, and regulatory consent.

In Greece, the two financial powerhouses will establish a commercial partnership framework. UniCredit’s asset management and unit-linked products will be distributed to Alpha Bank’s vast customer base of 3.5 million clients. Additionally, a joint venture called AlphaLife will be created for pension-saving products, with UniCredit holding a 51 per cent stake in this venture.

The finalisation of the partnership agreement in Greece is subject to due diligence, corporate approvals, and regulatory consent. This partnership will enable customers to access a broader array of banking services and products while maintaining service quality during the transition.

The parties will also explore additional collaboration opportunities to enhance their offerings in their respective countries, utilising their extensive international reach and capabilities in various banking services. This strategic move signifies a significant step in the ever-evolving European banking landscape.

UniCredit is making a strategic move by offering to purchase all the shares currently held by the Hellenic Financial Stability Fund (HFSF) in Alpha Bank, equal to 9 per cent. If the HFSF transaction doesn’t proceed, UniCredit commits to acquiring an equity stake in the market over 24 months.

This deal enhances UniCredit’s presence in Romania, while expanding its product reach in Greece.

The Romanian merger will impact UniCredit’s CET1 ratio by around 15 basis points, potentially adding over €100 million in incremental net profit on a run rate basis. For Alpha Bank, the transaction is expected to increase capital buffers and return on tangible equity (ROTE).

The Cyprus Stock Exchange (CSE) ended Tuesday, October 24 with losses.

The general Cyprus Stock Market Index was at 126.67 points at 12:38 during the day, reflecting a decrease of 0.25 per cent over the previous day of trading.

The FTSE / CySE 20 Index was at 76.76 points, representing a drop of 0.26 per cent.

The total value of transactions came up to €10,269.

In terms of the sub-indexes, the main and investment firm indexes fell by 0.4 per cent and 1.48 per cent respectively. The hotel index rose by 0.19 per cent while the alternative index increased by 0.01 per cent.

The biggest investment interest was attracted by the Bank of Cyprus (-1.02 per cent), Hellenic Bank (+0.45 per cent), Demetra Holdings (-1.54 per cent), and Louis (+2.88 per cent).