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Daily Press Review – 18/6/2019

First quarter 2019 results on 28 of June

Hellenic Bank Public Company Ltd (the “Bank”) announces that the Board of Directors of the Bank will meet on Thursday, 27th June 2019 to examine, inter alia, the Financial Results of the Group of Hellenic Bank for the First Quarter of 2019. The Financial Results for the First Quarter of 2019 will be announced to the Cyprus Stock Exchange and the Cyprus Securities and Exchange Commission on Friday, 28th June 2019, before the opening of the market.

 

Hellenic preparing a package of loans for sale

According to the article, Hellenic Bank is preparing a loan package for sale and for this purpose it will appoint international consultants. As stated in the Bank’s 2018 annual report for the first half of 2019, the Bank has begun a preparatory phase to review the viability of various non-performing loans in order to identify the option best suited for the Bank’s strategic objectives.

 

The cost of Cyprus’ delay in applying

Politis commenting on ESM new book of 425 pages ‘Safeguarding the euro at Times of Crisis’ brings back memories of Cyprus’ financial crisis of 2013.  According to those who lived through the crisis first-hand highlight the great cost related to the Chrsitofia’s government delay in submitting a request for help but also on the systemic side effects felt in Europe as a result of the haircut.

 

DISY resisting change to the foreclosures law

All political parties with the exception of DISY want to make changes to the foreclosures law just one year after its implementation. The changes are looking to slow down the process of foreclosures. DISY warns that this is not the right time to make changes and are expressing concerns about bringing up a turmoil for the banking system unnecessarily. The opposition parties’ proposal to slow down the foreclosures process was submitted to the House yesterday. AKEL intends to submit proposals for new changes to the law. At the same time, representative of the Ministry of Finance, George Panteli, warns that changes to the law will create problems with the NPLs. Changes will also affect Cyprus’s credit rating with international credit rating agencies.

 

Two years later and the case has not been persecuted

According to Politis, the Attorney General rejected for yet another time, the defense advocates’ request of the accused in the third case of Bank of Cyprus for suspension of the persecution. Therefore, after the acquittal of Eliades and Kypri the case continues normally for the other defendants Christi Chatzimitsi, Nikola Karyda, Christodoulos Patsalidis, Eliza Livaditiou and Despina Kyriakidou.

 

Relief from Bank of Cyprus cut in interest rates on existing loans

A small sign of relief for households and businesses following yesterday’s announcement by the Bank of Cyprus to cut interest rates on existing loans as of June 18, 2019. Interest rates are revised as follows; From 3.0040% to 2.8460% base interest rate for mortgage loans and from 1.2540% to 1.0960% base interest rate for business loans.

 

Submission of applications for Estia scheme in August

According to the article, applications for the Estia scheme will be received from August.  Applications for those who are interested will be received until October. Banks will carefully examine the applications, the economic data and property information of the applicants and send them electronically to the Ministry of Labor, responsible for managing the scheme, for a second evaluation. The Financial Director of the Economic Studies and European Union Directorate of the Ministry of Finance, Mr. George Panteli, speaking on radio Active said that no later than November borrowers will know if they quality to participate in the scheme.

 

Cyprus’ public debt is manageable

The Office of Public Debt Management sees the level of Cyprus’ public debt in a positive light, despite the increase resulting from the transaction between the Cyprus Co-operative Bank and the Hellenic Bank. It remains at manageable levels and within the targets set by the medium – term Plan 2016 – 2020. However, a rational and well thought strategy is needed since major challenges are created as a result of series of risks.

 

Many open fronts facing KEDIPES

A number of issues are pending to be dealt with at KEDIPES, including internal reorganization, new Board of Directors and most likely the revision of the terms of the agreement with Altamira. It is expected that these issues will probably be closed prior to the departure of Finance Minister Harris Georgiades from his position.  So the period between now and next September will be a period of intense work and developments.

 

Major changes in the banking sector

Following the financial crisis of 2013, the banking sector has changed drastically. The article goes presents a historic account of how the banks have been reduced, making reference to the latest absorption of the Coop-by Hellenic Bank, making it the second largest bank. Since 2018, the sum of the deposits exceeds the loans. The number of bank branches have been drastically reduced and along with that the number of bank of employees. The use of checks is reduced and the majority of employees staff are now women.

 

Bill suggesting changes to the foreclosures law

All political parties with the exception of DISY want to make changes to the foreclosures law just one year after its implementation. The changes are looking to slow down the process of foreclosures. DISY warns that this is not the right time to make changes and are expressing concerns about bringing up a turmoil for the banking system unnecessarily. The opposition parties’ proposal to slow down the foreclosures process was submitted to the House yesterday. AKEL intends to submit proposals for new changes to the law. At the same time, representative of the Ministry of Finance, George Panteli, warns that changes to the law will create problems with the NPLs. Changes will also affect Cyprus’s credit rating with international credit rating agencies.

 

Banks looking for windows of opportunities in Greece to strengthen their capital

The article says that banks are prepared to take advantage of any window of opportunity for pumping liquidity and strengthening their capital. However, the difficulties cannot be underestimated for the domestic financial institutions that are kept away from accessing the capital markets. The Piraeus Bank is the first with the issuance of a bon Tier II.

 

Still investing in banks

London-based alternative investment manager Caius Capital LLP is Bank of Cyprus’ new major shareholder with 3.09% or 13,785,707 voting rights in its hands. However, Caius did not acquire shares of the Bank through standard practice but invested instead through Contracts of Difference (CFD). Derivative contracts essentially allow investors to consider whether the price of a share will rise or fall in the future and move accordingly, either by selling or buying.

 

Transactions without cash and bank checks

Most Cypriots are choosing more plastic money and less cash for their trading transactions, with 57.5 % of payments in 2017 being made with a card.  At the same time the use of bank checks has decreased.  The banking architecture needs to change for the banks to become more competitive says IBM.

 

Ancoria Bank active in Greece

Ancoria Insurance, following its successful course in Cyprus and Sweden, is also active in Greece under the regime of freedom for the provision of services, in order to promote the group Ancoria Pension plan.

 

The Hellenic Bank Mobility Units have been successful

The results from the implementation of the Mobile Customer Service Units by Hellenic Bank, which will be re-evaluated in September, are highly satisfactory thus far. The institution has plans to extend this service to the mountain communities of West Limassol. According to Bank sources, “we believe that the results of the two mobile units so far are satisfactory and fully meet the objectives set. These mainly concern the service to the vulnerable groups of the population who do not have easy access to banking services, “it was explained.

 

Musical Chairs at Hellenic Bank

ETYK’s expressed intention to seek participation in the new administrative structure of Hellenic Bank is causing resentment/discomfort on the part of the majority of the Bank’s shareholders and management. Other large stakeholders who seek executive positions include Demetra Investments, who were excluded from the board of directors for the past few years, but this time they have doubled their participation, according to sources. Poppy Sarl’s – who is connected with Pimco – is also expected to claim at least one seat. Wargaming Group Ltd, HB’s second largest stakeholder who now owns 20,61%, will be claiming at least 2 or 3 seats on the new board, and Marianna Pantelidou is assumed to be re-elected. Lastly, Third Point and ERBD are expected to not be represented in the board. The annual general meeting is set for 24 July.

 

A new era of low interest rates

Prepare for a decrease in borrowing costs, as the global cycle of increased interest rates has reached its peak. This is the conclusion made by investments and markets considering that Central Banks of USA, Japan and Eurozone are called to make crucial decisions as it appears that the global economy is entering a period of more relaxed monetary policy. Tony Crescenzi highlighted on Bloomberg “Our main concern is the deceleration of growth”. He also mentioned “We expect that Central banks will maintain their interest rates at low levels for at least the next 5 years”.

 

Bargaining for successors Draghi and Juncker

Mario Draghi’s succession of ECB’s president, has developed into a battle of representatives for Merkel and Macron. For the first time, more than one EU seat is available – president of the Commission and the European Council – and France and Germany are bargaining in attempt to divide them according to their benefits.

 

€20m savings due to large amount of rain

This year’s large amount of rain has many advantages, which include savings worth €20m of state funds, due to the decreased desalination. According to relevant information, this year’s rain was the second best since 1900 and the best was in 1968-1969.

 

Consulting for Eurozone’s future budget

The Finance Ministers of the European Union, did not manage to agree on basic issues of Eurozone’s future budget, following consultations and they concluded that the discussion must be continued in the next few months. The ministers wanted to reach an agreement concerning Eurozone’s budget, whether it should be funded by a special tax, or whether it should be funded by the EU’s total budget. The extend of the budget was left undecided as well, given that they could not agree on the source of funding. Also, they couldn’t agree on whether the budget will have a stabilizing role in the case of recession or if it must contribute to the increase of the Eurozone countries’ competitiveness.

 

Double amount of Greek-Cypriots cross to occupied areas

Politis reports that according to police data recorded at the crossing points, for the first time since 2003 – when the crossing points opened – there were more Greek-Cypriots that passed to the occupied areas than Turkish-Cypriots that passed into the free areas. If the same trends continue, it is expected that the number of G/C who cross over will almost double compared to last year and triple compared to 2017. Already, G/C who visited the occupied areas in April and May have tripled since last year. This increase was recorded just after the drastic drop of the Turkish pound in March 2018 and is mainly related to fuel supply. JCC data also record an increase in sales.

 

 

 

Decrease in foreign direct investments for 2018

In 2018, for the third consecutive year, the foreign direct investments (FDI) decreased on a global level, according to the United Nation’s World Investment Report. They reached $1,3tr. And their drop was by 13% compared to 2017 which is due to the large-scale profit repatriation.

 

Cyprus as a maritime tourism center

Cyprus is becoming a leading center for maritime and marine tourism and looks forward to further upgrading the product and the experiences it offers to its visitors. Five years after its operation, the Limassol Marina became a reference point all over Cyprus. Limassol Marina has approximately 3,000 people on weekdays and up to 6,000 on weekends while more and more marine tourism enthusiasts enlist Cyprus as a place to be. Limassol Marina can accommodate up to 650 yachts and features luxury apartments and luxurious villas with their own anchorage. Some 300 or more boat owners rent their own space at the Limassol marina annually. It is the fifth marina in the world that has won the Gold Anchor Platinum Award. In addition to port services, the marina is a landmark as a recreation area, with more than 15 dining venues. At an advanced stage are the constructions at the Ayia Napa Marina, a project implemented by the M. M. Makronisos Marina Ltd consortium, with investors the Karamontani Group and the Egyptian Naguib Sawiris. In particular, infrastructure and docking are nearing completion. The article reports also on the licensing procedures regarding Paralimni Marina, saying that they are at an advanced stage.

 

Shipowners are concerned about the impact of the attacks in the Gulf of Oman Concerns over the attacks in the Gulf of Oman were expressed by shipping companies. Shipping companies are on the alert and expect new developments in the next few days. In particular, they worry about the safety of ships and crews crossing the Strait of Hormuz, but also about the impact of the attacks on oil prices. Bearing in mind how fragile the oil market is, inevitably prices will be affected. In Cyprus, shipowners are closely following developments and expect to see how this issue will roll out. Speaking to Phileleftheros, Deputy Minister of Shipping Mrs. Natasa Pilides said it is too early to calculate the impact of the attacks. She also stressed that Cyprus is not particularly affected, “as we did not have a Cypriot flag ship or a ship managed by a Cypriot ship management company”. Each shipowning company, or shipowners, must be alert, she added. Asked about the oil prices, she said that prices are certainly sensitive and influenced by international treaties. The Strait of Hormuz is the world’s most important oil artery, bringing together Middle East producers with Asia’s leading markets in Europe and North America.

 

Melco Resorts & Entertainment Purchases 19.99% Stake in Crown Resorts

Press release. Melco Resorts & Entertainment Limited has announced that on May 30, 2019, it executed a definitive purchase agreement through which a subsidiary of Melco will acquire 135.35 million shares of Crown Resorts Limited from CPH Crown Holdings Pty Limited for a price of AUD13.00 per Crown share. These shares represent an ownership interest of approximately 19.99% in Crown. The transaction entails two equal tranches.

 

Foundations for the expansion of My Mall Limassol have been set

It’s been routed over the past few years, but this year the time has come for the long-awaited expansion of My Mall, which will add 6.5 thousand square meters to the shopping center area, hosting new bars and shops. The preliminary architectural design has already been prepared, which will be finalized by September, and then a request for additional town planning permission will be submitted. MY Mall bets and is in the vicinity of major developments in Zakaki area such as the under-construction casino-resort. Expansion will not include supermarket and cinema as the progress of these uses in shopping centers abroad as well as other malls in Cyprus has not developed satisfactorily. The expansion will take place in the northwest of the building and will occupy about 200 of the 1,600 parking spaces currently available in the mall, but will be replaced by new ones that will be created by redeveloping the open-air parking and green areas.

 

Cybarco Group – Advertorial

In an all about interview of Cybarco Group, a Cypriot company with main activities construction and real estate part of Lanitis Group, there are references in past and new projects. The next major project planned by the Lanitis Group is Limassol Greens for which the necessary government licenses have been secured for the masterplan of the project and is now being studied at the alternative ways of financing it in cooperation with investors. It is a complex project that includes real estate, golf, leisure and shopping areas with restaurants and shops. Limassol Greens will be developed on a privately – owned land of the Lanitis group in West Limassol and bordered by other major developments in the area such as the casino, the Mall and the waterpark.

 

Big developments that set strong foundations for the economic growth

Big developments of hundreds of millions of euros complement the economic model of Cyprus, which in recent years has given new momentum to the economic growth of the country. The focus may be on developments such as multi-storey buildings, but in recent years efforts have been made to diversify the development model by creating new projects such as malls, casinos and other infrastructure related to tertiary educational institutions such as student halls of residence. These developments have created a chain of positive effects across the whole spectrum of the economy. One of these developments is the casino to be built in Limassol. According to the calculations, the project will cost around 550 million euros. The casino will be named City of Dreams Mediterranean and it is estimated that it will employ 2,400 employees with an impact on the economy at 4% of GDP. The Limassol casino is expected to bring 300,000 new tourists every year. It is worth noting that the casino of Cyprus will be the largest in Europe according to the data so far.

 

517 specialized doctors registered in the catalogue

Yesterday, the catalogue of GHS’ registered specialized doctors included 517 doctors. Over the last few days, Politis is continuously publishing the GHS catalogues in an attempt to aid its readers when searching for a specialized doctor, already registered in the GHS. These catalogues are of course updated on a daily basis according to new signed agreements between doctors who register with the GHS and the Health Insurance Organisation (HIO). There is a great majority of specialized doctors of the public sector but the HIO and the Ministry of Health (MoH) are optimistic and are expecting in the immediate future a significant increase in the registrations of specialized doctors.

 

State hospitals function at GHS rates

Alithia reports that, state hospitals are now running on GHS rates, said OKYPY’s representative Charalambos Charilaou, adding that any issues that come up are quickly dealt with. “We consider that we are fully operating according to GHS rules, state hospitals operate at normal rate as it should. There is increased use of our computer system and the users have in the meantime become more familiar, so any issues that come are dealt with quickly”.

 

Additions of clinic owners are being considered

Yesterday marked the second week of the implementation of the GHS’ first phase, one of the biggest reforms of our island. Constantinos Ioannou, Health Minister, says that he finds these results until now positive, noting that “we all have to understand that this is a system that has just been implemented, and we are expecting its service for the next decades. GHS is something that will be constantly improved, it is not static. There are issues, but huge efforts are put into their resolve, and thankfully the people have reacted in a very encouraging manner since day one. There may be deficiencies (e.g. specialized doctors), but we are expecting that in the immediate future more will join GHS, after witnessing that issues are being dealt with and that payments are carried out normally. The Minister also added that they are discussing additions in clinics, infrastructure, products and doctor fees, as they want to provide all beneficiaries with high-quality services, but also the option for higher quality at an increased expense.

 

Majority of Cypriots are optimistic for GHS

University of Nicosia’s IMR have published a survey concerning the GHS implementation. The results show that 73% of participants were optimistic and believed that the implementation of the new system will operate smoothly. On a different question, 70% though GHs to be able to meet the citizen’s needs, while 91% state optimism that the health care of Cyprus will be improved.