Co­op­er­a­tive bank chief quits, the search is on for new CEO ‘by mid-July’

Financial Mirror (Cyprus) - - FRONT PAGE -

Mar­ios Clerides, a soft-spo­ken and well-re­spected economist, re­signed as chief ex­ec­u­tive of the Co­op­er­a­tive Cen­tral Bank, less than half-way through his five-year con­tract. It has been re­ported that he re­signed for “per­sonal rea­sons”.

Bank of­fi­cials said that the search for his suc­ces­sor is al­ready un­der­way, with a re­place­ment re­cruited prob­a­bly by mid-July, just be­fore the ar­rival of the next team of in­spec­tors from the Troika of in­ter­na­tional lenders.

How­ever, Clerides’ sur­prise res­ig­na­tion caused a flurry of spec­u­la­tion, rang­ing from his ap­point­ment as the next Cen­tral Bank Gover­nor, should in­cum­bent Chrys­talla Ge­orghadji quit or be forced out, while other sug­gest that it fol­lows the same pat­tern as the ear­lier-than-ex­pected res­ig­na­tion of Bank of Cyprus CEO John Houri­can, who leaves Cyprus at the end of Au­gust.

Both banks are still dogged with high rates of non­per­form­ing loans, de­spite the pas­sage through par­lia­ment of the long-de­layed frame­work for fore­clo­sures and in­sol­ven­cies. Dif­fer­ences with their re­spec­tive boards over how best to han­dle the prob­lem have also been cited as rea­sons for the de­par­tures of both Clerides and Houri­can.

Clerides, 62, who joined the Coop from Hel­lenic Bank in De­cem­ber 2013, had a con­tract to the end of 2018, by which time the state-res­cued co­op­er­a­tive bank would have been on a path to re­cov­ery and growth, and pos­si­bly re­turn to public own­er­ship.

The bank had been bailed out by the gov­ern­ment to the tune of 1.5 bln eu­ros, which helped it re­struc­ture, down­size and merged all loosely-reg­u­lated Coop credit so­ci­eties into one en­tity, sub­se­quently of­fload­ing non-core as­sets and selling off un­pro­duc­tive di­vi­sions and prop­er­ties.

On Mon­day, the Co­op­er­a­tive Cen­tral Bank is­sued a state­ment con­firm­ing Clerides res­ig­na­tion, which has im­me­di­ate ef­fect.

“We would like to thank (him) for his valu­able ser­vices to the move­ment at a crit­i­cal junc­ture for the Co­op­er­a­tive and the econ­omy of Cyprus, con­tribut­ing through the ethos that de­scribes him the suc­cess­ful path of growth, re­cap­i­tal­i­sa­tion and re­or­gan­i­sa­tion of the Co­op­er­a­tive Credit Sec­tor in the past year and a half,” the CCB said in a state­ment.

It added that the su­per­vi­sory com­mit­tee is pro­ceed­ing with all nec­es­sary steps to en­sure a smooth suc­ces­sion to Clerides.

“We con­tinue on the path that we have charted, with the aim to re­alise our plans for the com­ple­tion of the ef­fort to cre­ate a mod­ern Euro­pean Co­op­er­a­tive that will con­tinue, through its 18 credit so­ci­eties (sub­sidiaries) to pro­vide ben­e­fi­cial ser­vices to its mem­bers and cus­tomers.”

Mar­ios Clerides, a grad­u­ate of the Lon­don School of Eco­nom­ics who has also served as Chair­man of the Se­cu­ri­ties and Ex­change Com­mis­sion (CySEC), has taught at the Univer­sity of Cyprus where he served on the coun­cil for the Cen­tre for Eco­nomic Re­search and was Chair­man of the Cyprus Bank­ing As­so­ci­a­tion. In April 2013, he was ap­pointed to the Na­tional Coun­cil for the Econ­omy, headed by eco­nom­ics No­bel lau­re­ate Dr Christo­foros Pis­sarides that ad­vises the Pres­i­dent of Cyprus on econ­omy is­sues and fu­ture pol­icy.

On Tues­day, the Cyprus News Agency quoted Yian­nis Stavrinides, in charge of strat­egy and com­mu­ni­ca­tion at the Co­op­er­a­tive Cen­tral Bank, as con­firm­ing that Mar­ios Clerides’ re­place­ment will be se­lected by the bank’s su­per­vi­sory com­mit­tee early next month.

Stavrinides said that vi­tal is­sues that re­gard the wider bank­ing sec­tor, as well as the strate­gic plans of the Co­op­er­a­tive, will be on the agenda of talks with the Troika in­spec­tors.

He added that the pre-se­lec­tion process should be con­cluded by the end of next week, with­out elab­o­rat­ing if spe­cific names had been men­tioned, while the re­cruit­ment of a non-Cypriot CEO is also pos­si­ble.

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