Insider Business Hellenic Bank:  First instalment for red loans

Hellenic Bank:  First instalment for red loans

Hellenic Bank will submit the first claim for payment of potential loss that may be incurred by the €2.6 billion of former Cyprus Co-operative Bank’s red loans.

The first requirement relates to the period until June 30, 2019 and will be submitted within one month of the publication of Hellenic Bank’s results, that is, in October.

The results for the first half of 2019 will be released on the Cyprus Stock Exchange today. Essentially, loans from the former Co-op Bank were given to Hellenic Bank when the former collapsed and part of its good business was transferred to the latter. These loans are in the grey zone to qualify as serviced.

The Asset Protection Scheme was part of the deal to absorb the good assets of Co-op Bank and the validity of the agreement is 12 years. It was agreed that the balance of the loans would be reviewed annually and if any losses arose they would be submitted to KEDIPES for reimbursement.

The agreement includes control mechanisms such as data submissions with all requests for reimbursement to allow confirmation by KEDIPES as well as the operation of a joint monitoring committee (comprising from one member from Hellenic, one from KEDIPES and an independent officer).

There is also a mechanism for resolving possible disputes by using an arbitrator.

The Plan will cover potential losses in a nominal loan portfolio of €2.6 billion, with a defined ceiling for losses (90% for KEDIPES and 10% for Hellenic Bank). The loan portfolio is stable and does not change during the Plan.

Under the Loan Guarantee Scheme, Hellenic Bank undertook to repay the Government the guarantees granted. The first payment of the guarantee fee is expected soon and amounts to €15 million. The total guarantee fee to be paid by Hellenic Bank (in case it does not reduce APS loans based on the relevant option) will amount to €63 million.

The matter was referred to Parliament yesterday at the House Audit Committee’s meeting. A Treasury officer said that KEDIPES will submit its first Hellenic Bank claim in October. He recalled that as part of the sale of part of the former Co-op Bank’s business, a government guarantee had been granted to Hellenic Bank for the portfolio it received.

 

Read more:

https://in-cyprus.com/administrative-peace-at-hellenic-bank/

 

Top Stories

Greece records over 2 thousand new covid cases in tragic peak-135 in ICUs (update)

  Greece recorded a new surge in new covid-cases, going over two thousand daily tally for the first time since the start of the pandemic. 2,056...

Cyprus records Covid death, raising number to 33, five critical-149 new cases

  A ninety one year old woman with underlying illnesses, succumbed to Covid-19 today at the Famagusta General raising the number of positive cases who...

Greek Orthodox priest shot in Lyon, France; assailant flees (update 2)

  A Greek Orthodox priest was shot and injured at a church in the French city of Lyon by an assailant who then fled. The priest...

Tala fire under control

  A massive blaze between the Tala, Koili and Kissonerga communities was placed under control late this afternoon, after more than two hours. It destroyed trees,...

The first 007 dies at 90-So long Sean Connery

  Scottish movie legend Sean Connery, who shot to international stardom as the suave, sexy and sophisticated British agent James Bond and went on to...

Taste

Squash soup

Ingredients: 1 kg pumpkin, cut into small cubes, approximately 5 cups 2 medium (400g) sweet potatoes, cut into cubes, approximately 2 ½ cups 1 chopped leek, only...

Mezedes

No visit to Cyprus is complete without enjoying the traditional meal of many small dishes known as ‘meze’. This large feast, which has been a...

Prawns with fried cheese, barley shaped pasta

Put the barley shaped pasta into a small pan with salted water, bring to a boil and when tender, drain. Peal the prawns leaving...

Salmon and shrimp sheftalies

Mix all ingredients for tabbouli in a bowl and keep to one side so flavours can combine. Prepare the sheftalies: wash and soak the casing...