Management stresses prudence, client focus in post-merger strategy

Eurobank Limited on Monday hosted a media gathering at its headquarters in Nicosia to provide updates on the recently completed merger between Hellenic Bank and Eurobank Cyprus.

Chief executive officer of Eurobank Limited Michalis Louis, opened the session by highlighting the significance of the merger.

He recalled that the process included a squeeze-out of minority shareholders and the delisting of Hellenic Bank shares.

The legal merger was completed on September 1, when the new entity, Eurobank Limited, officially began operating as a unified bank.

In this context, Louis praised the relevant government departments and regulators for facilitating what he described as a smooth and efficient process.

He said that while customers experienced no disruption, an extensive internal restructuring was required, involving significant work by teams from both Hellenic Bank and Eurobank Cyprus.

The CEO presented new financial figures for the bank, showing customer deposits at €23.3 billion as of June 2025, compared to €23.5 billion at the end of 2024.

Gross loans remained at €8.9 billion, while net loans edged up slightly to €8.8 billion from €8.7 billion.

Shareholders’ equity rose to €3.2 billion, up from €3 billion six months earlier, with total assets reaching €28.1 billion compared to €27.7 billion at the end of last year.

What is more, Eurobank Limited continues to stand out in terms of capital strength, with a common equity tier 1 (CET1) ratio of 34.0 per cent, more than double the EU banking average of 16.2 per cent.

Its non-performing exposure (NPE) ratio stands at 2.3 per cent, with a coverage ratio of 70.7 per cent, while its loans-to-deposits ratio remains exceptionally low at 38 per cent.

In this context, Louis stressed that Cypriot banks are well capitalised and compare favourably with their EU peers.

He said this has helped Cyprus borrow at the third-cheapest rates in the Eurozone, which he described as an economic advantage that must be safeguarded.

The Eurobank CEO added that the bank would not be reckless with its money and would continue to spend prudently.

Louis also spoke about the Cypriot economy, saying that GDP growth accelerated to 3.3 per cent year-on-year in the second quarter of 2025, bringing first-half growth to 3.2 per cent.

He said the economy is no longer dependent on a single sector, mentioning that information and communications technology (ICT) now contributes around 13 per cent to GDP, with expectations for this share to increase further in the next revision of national accounts.

Following Louis’ introductory presentation, deputy chief executive officer Haris Hambakis took the floor and reflected on the bank’s March 2025 commitment to merge the two institutions seamlessly.

“We took a risk in March telling you that we would merge the two banks without you noticing,” he said, adding that he hoped the bank had succeeded in doing so.

He added that another unannounced decision in March, the last time the bank had the media at its headquarters for a briefing, was the renaming of Hellenic Bank into Eurobank.

Haris Hambakis, Deputy CEO, Eurobank Limited

Hambakis explained that the merger was complex, involving multiple regulators and government departments, but that the bank had successfully consolidated client data and information into a single system without issues.

“The most important thing for us are the clients,” he said, pointing out that since September 1, customers have enjoyed uninterrupted access to all services, including cards, and may now also be served at new branches of the unified entity.

Transfers between accounts at Eurobank and former Hellenic Bank accounts are now executed free of charge on the same day, provided no currency conversion is needed, and are processed through the most appropriate channel, either SEPA or SWIFT.

Fifteen branches are currently operating under a branch-in-branch model (eight from Eurobank and seven from Hellenic Bank) until the full network integration is completed.

Hambakis said that after market surveys, the bank decided that renaming the bank would be more beneficial, even if the task required extensive effort to update documents, websites, ATMs, and other infrastructure.

He revealed that additional changes will take place over the next two years, with significant investment planned for branch renovations and digital platforms to align with the bank’s new corporate image.

During a Q&A session after the presentations, Louis addressed questions about a possible dual listing on the Cyprus Stock Exchange (CSE), stating that this is expected by the end of 2025 or early 2026.

He confirmed that the stock to be listed will be that of the parent company, Eurobank Holdings, which owns the new Cyprus entity.

Asked whether Eurobank sees Cyprus as a base for investments abroad, Louis said that growth opportunities lie to the east, citing Asia, the Middle East, the Gulf and Israel.

He pointed to the bank’s new office in India, explaining that Eurobank wants Indian businesses to use Cyprus as a base and gateway for investing in the EU.

He added that India has many high-net-worth individuals and that Eurobank aims to leverage its wealth management expertise to attract them.

Louis also said that Hellenic Bank’s retail products have been maintained but that best practices from the Eurobank Group will be gradually implemented in Cyprus.

“We want to give loans but we want to be careful where we do that,” he said.

In this context, he explained that the loan portfolio has grown and that other banks in Cyprus have also approved many loans, which he called a positive development for the economy.

On staffing, Louis acknowledged that staff exit plans would continue to exist, saying that they are often requested by employees themselves.

“When you go through such a major restructuring, there will need to be a further reduction in staff,” he said, adding that the timeframe for this will be within the next 12 months, with details of the scheme still under review.

Louis also mentioned the bank’s deal with CNP Insurance, saying that the legal merger is expected to take place in October.

This follows the April 2025 completion of the acquisition of the CNP Cyprus Group, creating the largest insurance organisation in Cyprus, with operations under ERB Cyprialife for life and health insurance and ERB Asfalistiki for general insurance.

Louis also acknowledged the emotional impact of the merger and rebranding, saying that it was significant even for him, having served as CEO of Hellenic Bank for a year before the transition.

Hambakis concluded by announcing a new campaign that will launch later this month to mark the beginning of a new chapter for the bank, followed by a separate campaign dedicated to the insurance division.

He said that these campaigns will ensure that all products and services are presented under the unified Eurobank identity.