Gov't To Transfer Cypriot banks' Assets to Domestic Bank

Gov't To Transfer Cypriot banks' Assets to Domestic Bank

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By Hellas Frappe on 17.3.13

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(Photo credit: Wikipedia)

Greek Finance Minister Yiannis Stournaras offered full reassurances that deposits in Cypriot banks' branches in Greece were not at risk and said that a plan was examined to transfer all assets by Cypriot banks operating in Greece to an existing Greek financial institution.

Speaking to reporters, after a meeting of the Council of Systemic Stability on Saturday evening, Stournaras said the council unanimously agreed on the plan along with a mandate to the Bank of Greece to examine the interest of Greek commercial banks on the plan.

"The Council of Systemic Stability convened to discuss a decision reached by the Eurogroup over a political agreement between Eurozone finance ministers and CyprGreek Finance Minister Yiannis Stournaras offered full reassurances that deposits in Cypriot banks' branches in Greece were not at risk and said that a plan was examined to transfer all assets by Cypriot banks operating in Greece to an existing Greek financial institution.

Speaking to reporters, after a meeting of the Council of Systemic Stability, Stournaras said the council unanimously agreed on the plan along with a mandate to the Bank of Greece to examine the interest of Greek commercial banks on the plan.

   "The Council of Systemic Stability convened to discuss a decision reached by the Eurogroup over a political agreement between Eurozone finance ministers and Cyprus authorities over developments in the Cypriot banking system. The agreement fully safeguards depositors in Cypriot banks operating in Greece, safeguards Greek state interest and financial stability and does not burden the management of Greek public debt. In the framework of the agreement, the Council unanimously recommends the transfer of all Cypriot banks' assets in Greee to an existing Greek financial institution. The Bank of Greece will examine the interest of Greek banks in buying these assets".

Sources said that Bank of Greece has already begun talks with Greek banks with the aim to reach an agreement by Tuesday, if possible. The same sources, however, said that foreign banking groups were not excluded from this process. In any case, Greek authorities will choose the best solution.

Finance ministry officials were reassuring that there will be no possible negative effects on the domestic banking system, following Eurogroup's decision to impose an extra duty on deposits in Cyprus, nor any mass withdrawals of bank deposits. amna

Three Cypriot banks operate in Greece, Cyprus Bank, Laiki Bank and Hellenic Bank with a branch network of more than 300 units and a workforce of around 5,000. (AMNA)