Cyprus Press Review - 28/6/2019

The challenge and the silence of the lambs

24H reports that the Auditor-General reported that some of the Co-op’s employees took advantage of the bank’s voluntary retirement scheme. The author argues that no one reacted to his statements. Some of the Co-op’s employees took advantage of the retirement scheme that was implemented during the collapse of the Co-op and its absorption by Hellenic Bank, and received a €100.000 compensation. Instead of going home and looking for work somewhere else, they were re-hired immediately afterwards, by the Cyprus Asset Management Company (KEDIPES), the successor company of the Co-op, which took up all the remaining assets of the bank. According to information provided by the Auditor-General, the number of these employees amounts to 60. Some of them were employed with salaries between €4000-5000. Remarkably, one of them was a given a car. At the same time, it was revealed that some Co-op assets, after passing to KEDIPES, ended up in the hands of politically exposed persons, former Co-op officials, as well as KEDIPES employees. Certainly, these properties were sold in attractive prices, since, the author argues, the buyers evidently had inside information. The author argues that everyone expected that after these revelations, there would be turmoil, there would be an investigation and criminal proceedings, that there would be resignations and protests. Nothing has happened so far. It was reported and broadcasted and there was some criticism, but nothing more. Nobody challenged these claims, nor explained them, the author adds.



Stories of power: Ioanna’s story  

Hellenic Bank intends to keep the promise it gave in its latest campaign, which launched an important social initiative with a focus on individuals. Following the stories of George and Andrea, the campaign now focuses on Ioanna’s story, a 16 year-old girl who is just like any other, but at the same time, nothing like them. Early in her teenage years, Ioanna showed symptoms of selective mutism and it was then that everything in her life changed. Without many friends and low self-esteem, she started being closed-off. Her only way out was horse-back riding and equine-assisted therapy. Through equine-assisted therapy, she became more social, develop friendships and dream. Her biggest is to become a horse trainer so that she can help other children in the future.



List of Co-op properties that will be given to communities goes to House

The Director-General of the Finance Ministry sent a letter to the House, informing them on the developments with regards to the state’s usage of the Co-op’s assets. The Director-General’s letter was sent in light of a Cabinet decision on 6/5/2019 to proceed with acquiring 305 properties. The president of the republic had promised, after local the local authorities requested it, that the 305 assets are given to 14 municipalities and 153 communities. The properties in question include buildings, shops, branches, offices, warehouses, rooms, parking lots, plots, fields and even a winery, a football fields, supermarkets, a machine shop and a fuel station. Furthermore, the SPE Pylas, which is included in the list will be given to the UN. The whole acquisition procedure will be completed in February 2019, while the second phase will be completed by the end of 2019. Already, the Finance Ministry has asked KEDIPES to postpone the sale of properties, until the 2^nd phase is approved, except fields and plots, and properties that have been acquired in exchange for debt, as well as the buildings that the Technical Committee will allow to be sold-off.



ECB green-lights changes in CBC’s governance

In an opinion, the European Central Bank (ECB) welcomed a government bill, which stipulates fundamental changes to the governance of the Central Bank of Cyprus. The bill abolishes the article of the Central Bank’s main law, which relates to the centralisation of responsibilities to the face of the Central Banker and foresees the establishment of an executive committee (chief, deputy chief and two executive members), as the new decision-making body. The initial plan was submitted to the ECB for an opinion in February 2018, which in May 2018 made annotations that were incorporated to the new bill, for which they issued a new opinion.



Estia to bring postponement of foreclosures

Politis’ article reports that the most interesting aspect of the Estia scheme, that was highlighted in yesterday’s House Finance Committee, was that when a borrower submits an application for Estia, all measures against them, including the foreclosure procedure are halted. The Finance Minister said that “I find it inconceivable to have foreclosures now that the Estia is being launched, and the matter of amending the foreclosures legislation should also be postponed, until we have the full picture”, said Mr Georgiades, linking the implementation of the Estia scheme with the initiative for amendments to the foreclosure procedure. Mr Georgiades, referring to Central Bank data stressed that the official information that we have is that there have been no foreclosures.



Central Bank optimistic about real estate sector

The Central Bank estimates that the real estate sector will continue to grow, appreciating that billions of euros will continue to be channeled for the construction of residential and non-residential properties. Investments in houses and other developments amounted to €2.4b in 2018 and the Central Bank expects this trend to continue, since there is a positive climate in the market, without the large distortions that the financial sector saw in the past. The construction sector’s contribution to Cyprus’ GDP stood at 1.2% in 2018, while entire real estate sector (construction and real estate activities), made up 1.3% of the GDP during 2018. “On the basis of the above, it should be noted that the development that is observed in Cyprus is not only due to housing projects, but also due to productive projects such as marinas, offices, shopping centres, casinos, hotels, renewable energy projects, which increase the potential GDP”.