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Daily Press Review – 12/6/2019

How many branches and ATMs do the 10 banks have?

The consolidation of the banking sector has brought many changes in the number of bank branches currently in operation per 100.000 residents. At a time when the banks are betting on digital transformation, the customers are being served by less branches and choose to perform transactions through electronic channels, creating a new state of affairs. The 2018 numbers are foreshadowing what will follow in the coming years. In 10 years, the network has shrunk to 61.7% per 100.000 residents. According to the information of the Association of Cyprus Banks, there were 44 branches per 100.000 residents, while in 2017 there were 53. As it comes to the network, Hellenic Bank is first as it comes to number of branches and ATMs, followed by Bank of Cyprus. The absorption of the good part of the Cyprus Co-op bank by Hellenic in September 2018 meant an additional 149 branches and 179 ATMs, while the number of employees now stands at 2,361. In 2017, Hellenic had 121 branches, 156 ATMs and 3,704 employees. In 2017, it had the same number of branches, 156 ATMs and 3.704 employees. As it comes to the Greek banks, Alpha Bank has the largest network with 22 branches, 25 ATMs and 682 employees. The National Bank of Cyprus had 9 branches in 2018, 12 ATMs and 242 employees. Eurobank had 8 branches, no ATMs and 376 employees. RCB Bank has 8 branches, 9 ATMs and 320 employees.


APS only managed a €280m reduction of NPLs

APS has recorded rather poor performance, as it comes to servicing the NPLs of Hellenic Bank. The bank’s NPLs have dropped to 26.5%, compared with 53.3% in the end of December 2017 (the year before the Co-op’s healthy business was absorbed). However, this development has not exclusively been caused by the Czech company’s management. It is because the healthy assets that Hellenic absorbed from the Co-op, were much greater than the NPEs it absorbed. The SSM is pushing the banks to get eliminate all NPLs, or at least reduce them to one-digit rates. Besides, this is why Hellenic proceeded to an agreement with APS in January 2017. However, according to the data, it seems that there hasn’t been a lot of progress. Hellenic Bank’s NPLs in December 2017 amounted to €2.16b. By September 2018, it managed to only reduce them by €80m, while by December 2018, it reduced the bank’s NPLs by €60m more. It should be stressed that in July 2017, they took up €2.3b-worth of the Bank’s NPLs. As such, since July 2017, when APS started working, it only managed to reduce the Bank’s NPLs by €280m. If one also takes into account the fact that Hellenic Bank sold €144m of NPLs to B2Kapital Cyprus, APS’s performance becomes even poorer. The article reports that because of everything mentioned above, rumours have intensified that the Bank is looking for different ways to improve the bank’s asset management company. The author argues that this could be because competition between “servicers” has also intensified, and comparisons can be easily made.  The author goes on to say that the Bank’s CEO is satisfied with their cooperation with APS. Even though APS’ performance is limited, the company does not own the NPLs, but merely services them. Hellenic Bank is the one taking decisions, and this is why they have said in their 2018 results, that they are preparing to examine the viability of different methods to reduce NPLs, so as to identify the options that better suit the Bank’s strategic goals. In order to complete the preparations for this process, the Bank will appoint international consultants to facilitate high-level discussions, after coming to a confidential agreement with the different third parties that may be interested. Such parties include investment banks and financial investors. The article also goes on to analyse the bank’s agreement with APS. In fact, the bank signed an agreement with APS Holding in January 2017, for the management of the bank’s assets and NPLs. The agreement stipulated the sale of Hellenic’s Delay Management Unit to APS Debt Servicing Cyprus Ltd, while Hellenic would still own the assets and loans portfolio. APSHolding holds a 51% stake in the company, while Hellenic has 49% of equity. The agreement was signed in the end of June 2017, while it entered into force in July 2017.



KEDIPES’ new board is still being evaluated, six months later

Brief.com.cy reports that the members of the Board of the Cyprus Asset Management Company (KEDIPES) have been evaluated by the Central Bank of Cyprus for 6 months. They are evaluating them according to fit and proper assessment, without achieving a positive outcome yet. Brief’s sources report that all the members of Board are going through this procedure, which under normal circumstances would last between 5 weeks to 3 months. The five members that the Minister of Finance has proposed, are Lampros Papadopoulos (accountant, former Board Member of Citibank and other banks), Dr. Marios Pitsillis (Professor of Economics, and former Board Member of Laiki bank), Marios Chiromerides (Director of a consulting company with experience in asset management), Doros Ktorides (former senior member of Laiki Bank), Sophocles Parapnos (works in Finance). According to the criteria set by the Commission’s DG Comp, in the framework of approving the state aid that facilitated the absorption of the ‘good part’ of the Co-op by Hellenic Bank, the chosen members must have 10 years of experience in asset management. After approving the names proposed by the Cabinet, the new Board will choose KEDIPES’ CEO.


Shopkeepers concerned with operation of Deryneia crossing point

The organised shopkeepers of Paralimni municipality will hold meetings with all political parties in order to express their concerns and opinions about the adverse consequences on the economy of the free Famagusta area, which are directly caused by the operation of the Deryneia crossing point. Their representative, Markos Pasis spoke to Phileleftheros, stating that taking into consideration the decreased arrivals of tourists, and also the existing problems faced by small enterprises (SMEs) in general, the negative impact of the Deryneia crossing point is now apparent cannot be hidden.


Citrine Estates attracts great investment interest

Citrine Estates, the project that is being developed by CNS group, had a dynamic presence in the MIPIM expo in Cannes, the Monaco International Luxury Property Expo’ in Monaco and ‘China Offshore Summit Series’ in Shenzhen. It thereby managed to attract plenty of investment interest as well as many comments by investors, buyers and professionals of the sector. It should be noted that Citrine Estates is planning to take part in many expos over the coming months. Its prime location, next to the upcoming emblematic casino-resort, City of Dreams Mediterranean – the biggest casino in Europe – as well as its close proximity to Lady’s Mile Beach and the natural environment that surrounds it, offers a unique holistic balance between good taste, high quality and natural beauty.


Ministry of Health’s decision causes tension

The Centre for Preventive Paediatrics (CPP) expressed their intense dissatisfaction with the MoH’s announcement that they will offer free hearing tests for all infants. The CPP, which has been responsible for the implementation of this action for the past 14 years, claims that this decision will divide this particular service in various state hospitals, and will cause confusion among doctors and parents, and will simultaneously lead to a significant increase in costs, as the state will be burdened with the full amount. They are asking for the immediate revocation of this decision, so as to avoid unnecessary problems, given that there is an existing programme, which provides free hearing tests for infants.


List of changes to “fill the gaps” of the GHS

The MoH is changing things along the way as GHS progresses. The problems that have been observed, have also been recorded by the competent state authorities, as has a list of parameters that must be implemented. The overall picture at state hospitals shows that there is a lack of information for both patients and health professionals in the new environment of public health, as HIO prepares for a new educational campaign. Issues with General practitioners (GPs) and specialised doctors are high on the list of issues that need to be immediately resolved. It appears that GPs have a disproportionate allocation of patients when compared to state doctors. The HIO is examining the possibility of allocating some citizens from GPs to state doctors. The issue that they are facing with specialised doctors has to do with the number that has joined the GHS. The last issue which causes concerns is the lack of flexibility and mistakes of the past in regards to management issues. According to Kathimerini, HIO will give out the first payments to health professionals (doctors, pharmacists) that have been registered to the GHS, on 15 June.