CCB sale in limbo, Citigroup quizzes Apollo fund and Hellenic Bank

The sale of the Cyprus Cooperative Bank’s ‘ good assets’ portfolio seems to be in limbo as the two potential buyers have yet to answer key questions posed by the institution’s appointed financial advisor. Citigroup Global Markets had sent questionnaires to US-based Investment Fund Apollo Capital Management and Hellenic Bank that had submitted their bids two weeks ago.

However, the two interested investors did not get back to Citigroup GM with their response on two crucial points. According to the Cyprus News Agency, sources close to the procedure said the CCB’s financial advisors expected answers on two key questions which could prove to be dealbreakers.

Specifically, Citigroup has asked Apollo if it has found the financial vehicle, that is, the licensed credit institution through which it plans to absorb the banking activities of the collaboration.

On the other hand, the question to the Hellenic Bank concerns whether it has clarified what its share structure will look like after the acquisition of the CCB, as the takeover implies a capital increase that has to be approved by the existing shareholders.

So far, Hellenic Bank has announced the convening of an extraordinary general meeting for July 11 (immediately after the approval of the annual results), but the agenda does not include a potential capital raise.

Meanwhile, news reports suggest that Citigroup has not set a schedule for the completion of the process as negotiations with the bidders seem to be complex and timeconsuming. On Wednesday, Finance Minister Harris Georgiadis also said that the process still has a long way to go.

Speaking on state radio CyBC, the finance minister said that “no substantive evaluation and discussion with potential investors has begun, because the process is still at a stage of completing and submitting clarifications and explanations. process”.

The minister said that there is a plan in place and is implicitly related to the government’s fiscal policy approved by the Cabinet as the non-performing loans of the bank will be taken over by the state. Commenting on the matter, he said that this “does not mean that they will be paid by the taxpayer. Nor is there any need to impose a tax or any other form of charge on the taxpayer in the context of a portfolio separation. These loans have to be paid by the people who took them”.

Georgiades said that “each euro paid for these loans will in some way be a public revenue towards the initial cost which the state has undertaken”.

He added that this does not go to say that the body which will be formed to handle the bank’s NPL portfolio will not be able to restructure and make adjustments where appropriate.

It

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