BOCH in “satisfactory” debut on LSE
Bank of Cyprus Holdings (BOCH) made a “satisfactory” debut on the London Stock Exchange main market on Thursday, with about 800,000 shares changing hands by late afternoon, that saw the stock trading at EUR 3.35, at the bottom of the day’s range of 3.35-3.55.
It had opened trade at EUR 3.27, but half-way through the day, a single spike sent the share price to EUR 4.45 in London, in a single off-exchange trade of 10,000 shares.
Analysts preferred a “wait-and-see” attitude, saying that a single trading day was not indicative of the stock’s performance. However, almost all contacted by the Financial Mirror said it was a satisfactory debut.
BOCH, the Irish-based holding company of the restructured Cypriot lender, was trading on the home Cyprus Stock Exchange at a discount, closing the day at EUR 3.30, having started at 3.27, with a daily volume of 490,000 shares.
On Friday, BOCH closed on the LSE at EUR 3.3450, on Monday at 3.3475, retreating on Tuesday under pressure to 3.2000.
Having delisted from the Athens Stock Exchange last year, BOCH listed 446,199,933 ordinary shares on both bourses in what is expected to improve the bank’s liquidity and enhance its visibility to a broader base of investors and boost confidence in stakeholders, the bank said in a statement prior to the parallel listing.
This follows the declaration ten days earlier that the bank had fully repaid the emergency liquidity assistance of EUR 11.4 bln imposed after the Cyprus economy bailout in 2013 and the subsequent bail-in by Bank of Cyprus shareholders to rescue now defunct Laiki Popular bank.
Among the new investors was US Commerce Secretarynominee Will Ross, whose fund WL Ross & Co LLC pumped in more than EUR 400 mln during the two waves of capital raises, and has declared its intention to remain a shareholder in the bank.
The fund reportedly informed the bank that it intends to announce a new replacement for Ross, who had been Vice Chairman ever since the rescue.
In regulatory announcements, all major investors were obliged to declare their position and any possible changes, as a result of which Canadian-based Senvest Cyprus Recovery Investment Fund, LP notified the London bourse that it had increased its stake in BOCH and now owns 14,800,831, having thus passed the 3% threshold and rising to 3.32%.
Analysts said that the accumulation had taken place “recently” and that the increase was not significant. Senvest also held a 5% stake in Hellenic Bank, which has since been diluted marginally following the participation by the European Bank for Reconstruction and Development, EBRD, that also owns a 5.02% stake in BOCH.
Bank of Cyprus also announced it had returned to the markets with a successful issue of EUR 250 mln 10-year bond, priced at 9.25%.
Meanwhile, Dr. Josef Ackermann, Chairman of BOC Holdings, said prior to the shares commencing trade on the LSE last Thursday, that “this listing, on one of the world’s leading international markets, will facilitate greater profile, liquidity and market access.”
“The listing … enables us to fulfil a long-standing commitment to shareholders. It also constitutes an additional major milestone in the transformation of the Group and its strategy to enhance its financial strength.”
HSBC Bank plc acted as adviser to the London listing and Cyprus Investment and Securities Corporation Limited as the lead manager in relation to the listing in Cyprus. Sidley Austin acted as English and US legal advisers, and Chryssafinis & Polyviou LLC acted as Cypriot legal advisors to the group.
In an announcement in the morning, the London Stock Exchange said it welcomed Bank of Cyprus Holdings to trading on the main market as the banking group, with a EUR 1.4 billion market capitalisation, successfully completed its London listing.
BOC Holdings joins 54 global banking stocks already listed in London, with a combined market capitalisation of $1.2 trillion.
The admission builds on London Stock Exchange’s strong Cypriot credentials, which include being the listing venue for Cyprus’ most recent sovereign bonds. The Cypriot government’s EUR 1 billion sovereign bond in London in 2016 secured record low yields for the government, at 3.80%. In 2016, London Stock Exchange profiled five Cypriot companies in its “1000 Companies to Inspire Europe” report which identifies Europe’s fastest growing and most inspiring businesses.
“BOC Holdings’ listing is a milestone for the company and for Cyprus. It demonstrates the bank’s strong recovery since the financial crisis and underlines London’s ability to help the banking sector recapitalise itself for growth,” said Nikhil Rathi, CEO, London Stock Exchange plc.
“Its choice of London highlights the City’s ability to support access to funding for companies from around the world, reinforcing its status as a leading global listing venue and dynamic place to do business,” Rathil added.
Announcing the plans back in November, Bank of Cyprus said that once its standard listing in London was completed, it intends to seek a Premium Listing in order to become eligible for inclusion in the FTSE UK Index series.
Its headquarters, management and operations will all remain in Cyprus, with both the existing bank and the new holding company to be tax resident in Cyprus. The Bank of Cyprus will also continue to be regulated by the European Central Bank and the Central Bank of Cyprus.
On Thursday, Bank of Cyprus also announced that the Cyprus Securities and Exchange Commission will be the competent authority supervising takeover bids, while in a separate announcement it said that for the purpose of Irish transparency regulations, Ireland will be its “home member state,” as stipulated by the Central Bank of Ireland transparency rules and the European Transparency Directive 20040109/EC.