BOCY has reached 80% of restructures, ELA drops further
Bank of Cyprus officials have said that the lender has concluded about 80% of is targeted restructuring of nonperforming loans and that the aim is to close the year with EUR 1 bln worth of bad loans.
To date, some EUR 3 bln of bad loans have already been restructured, almost half of its target, that corresponds to about 30 big debtors.
Not among them is the Church of Cyprus, which has offered to put up land as collateral and to restructure some EUR 100 mln of its own NPLs held at the bank, similar tio two deals already concluded at the Hellenic Bank.
Meanwhile, press reports over the weekend suggested that BOCY had reached a deal with major debtors, namely the three property companies Pafilia, Zavos and Tsokkos Hotels, with two more restructuring underway.
The names of the three clients that have successfully restructured their obligations with BOCY had made headlines last year when a confidential list of the Bank of Cyprus’ top-30 borrowers with non-performing loans was leaked to the press, the Cyprus Mail reported, adding that according to the list, which represented a snapshot of outstanding loans in June 2013, the Zavos group had EUR 134 mln in unserviced exposures, Tsokkos had 172 mln and Pafilia had 90 mln.
Earlier this month, Nick Smith, the bank’s head of restructurings and recoveries, had said that the lender was at a “tipping point” in reducing bad loans after the pace of restructurings picked up in the second quarter and is considering reducing its exposure in larger loans through syndication.
“Even though the official nonperforming exposure levels will not change for about a year, those who today dismiss the progress made, will no longer be justified in doing so,” Smith said.
BOCY saw itsNPLs drop to EUR 14.2 bln or 62% of its gross loans in September from almost 15 bln or 63% last December.
Meanwhile, the Bank of Cyprus has reduced in September its dependence on the Emergency Liquidity Assistance (ELA) by EUR 230 mln to 4.17 bln by the end of November, according to figures released by the Central Bank of Cyprus. This was down from 4.40 bln at the end of October.
Since the beginning of the year, the bank reduced its dependence on ELA by EUR 3.2 bln, as at the end of December 2014, the facility stood at 7.4 bln.