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Daily Press Review – 21/10/2019

Scholarships by Hellenic Bank

Hellenic Bank presented the JumpStart scholarship programme on Wednesday, 25 September at the Bank’s headquarters in Nicosia. Through the programme, Hellenic Bank is promoting the dreams of young people who believe in their strength, by granting 20 scholarships to 20 students worth €2.000 each year, for four years of studies. The students will be chosen on the basis of specific social, economic and academic criteria. JumpStart by Hellenic Bank will support young people with dreams and talent, whose lives weren’t so easy but who have been armed with perseverance, willpower and strength.

 

Bank branches without tellers

There will be significant changes in the banking system in the coming period. According to the banks’ actions so far, as well as the stakeholders’ statements, the banks will now operate with much less staff, while the branches will look very different compared to their current state. Technology will replace many of today’s banking business and the banks’ personnel will cover different needs than what they currently cover. At the same time, there will be changes to the way the employees are paid, taking into account performance and position. Yesterday’s statements by BoC’s CEO, Panicos Nicolaou are indicative of the changes anticipated in the (not so distant future). Responding to questions in the context of a discussion at the Limassol Economic Forum, Mr Nicolaou referred to the challenges that the banks will face with the new pay policy and the way that the bank branches will operate. The CEO of Bank of Cyprus said that the change in the banks’ pay policy is inevitable, noting that they must negotiate with the unions on this matter. The banks must move fast and discuss with the unions in order to promote a more fair pay policy. A pay policy that is based on performance and position. It should be noted, the paper adds, that ETYK and Hellenic Bank are currently disputing over the way raises are granted.

 

Are we going to be playing for long?

Phileleftheros’ author argues that Hellenic Bank has taken a reasonable decision. It will be granting raises based on the employees’ performance and labour market conditions. This should have been done decades ago or even in 2013, when many restructurings were put forward in the banking system. It’s not a matter of restricting the bank employees’ raises. We are not even examining whether Hellenic’s plan is fair but we can definitely say that its rationale makes a lot of sense. Besides, it includes a steady raise for every employee, no matter their performance and position. ETYK has been reacting intensely because Hellenic’s management unilaterally decided to proceed with this decision. Hellenic has been arguing that even though they called ETYK to negotiate, they didn’t come and ETYK says that nobody called them to negotiate. As always, the truth can be found somewhere in the middle. For many days now, we have been waiting for the Labour Ministry’s and the Minister’s intervention on the matter. Zeta Emilianidou has a very good reputation for dealing with this kind of labour issues. The Minister does not seem eager to touch upon this issue, as it will potentially decide the future of labour issues for the entire banking system. We believe that it’s high time she did intervene, making sure that Hellenic Bank’s decision serves as the basis for future negotiations. However, it may think that rewarding employees on the basis of their performance is unreasonable. While collective agreements and codes of conduct are respectable, at some point there should be a break. At least for the matters that don’t make sense, the Minister should decide that it’s time for change. By threatening to sue, no issue can be resolved, the author concludes.

 

BoC VRS successful, paves the way for restructuring

Even though there were initial concerns about the fourth Voluntary Retirement Scheme by Bank of Cyprus, it has reached its targets and over 400 people are departing. This is a development which paves the way for the implementation of the bank’s ambitious restructuring scheme. The Bank’s CEO, Panicos Nicolaou described the targets of the scheme, speaking at the 10th Limassol Economic Forum. The scheme foresees compensation of up to €200.000, while the bank had collaborated with ETYK in order to design the scheme. The union actively contributed in the success of the scheme. Politis’ sources report that the BoC’s management is close to reaching an agreement with ETYK for the implementation of a rewards system similar to that requested by Hellenic Bank.

 

Number of applications disappointing

Applications for ESTIA are very limited and it is rather doubtful that the situation will be reversed by 15 November, which is the deadline for applications. The government’s and the banks’ concerns about the failure of ESTIA seem to have been confirmed and the banks are now looking into ways to improve the agreement. According to Stockwatch, the number of applications is disappointing. Up until now, 350 applications have been counted, out of a total 12 thousand eligible borrowers. The 350 applications that were approved correspond to loans amounting to €110m, compared with the €3.4b loans, that were calculated initially. Around 90% of applications come from Bank of Cyprus and KEDIPES.

 

€118m in tax exemptions in 2017

229.895 out of 285.568 taxpayers who submitted tax returns for FY2017 claimed €118m in tax exemptions. Currently, taxpayers receive tax exemptions for contributing 1/6 of their net salaries to various funds. Specifically, the Tax Department calculates the contributions of taxpayers to the relevant funds, such as healthcare fund, GHS, life insurance schemes and social insurance. The Tax Department includes the contributions of taxpayers to the different funds in its calculations and subsequently discounts their taxable income by 1/6.

 

Cyprus chaired the Commonwealth Finance Ministers Meeting 

The Commonwealth Finance Ministers Meeting (CFMM), which was chaired by Cyprus focused on the role of the creditors and debtors in their effort to promote the sustainable management of public debt, with a special focus on new technologies, such as Blockchain. The meeting was held on the sidelines of the annual meeting of the World Bank and the IMF in Washington. The fact that Cyprus had the opportunity to chair the meeting, was a huge honour. Cyprus’ FM Harris Georgiades, called on the Ministers of Finance to take joint actions to promote new technologies to improve the transparency and sustainable management of public debt.

 

Semi-governmental organisations turnover €1.4b

The annual turnover of 42 bodies governed by public law amounted to €1.4b. These organisations employ around 8.524 employees. According to Finance Ministry data, CYTA employs the largest number of employees, while the Cyprus Organisation of the Management of Petroleum Products (KODAP) has the least employees. Specifically, CYTA has a total 2,248 employees, while KODAP has only 2 employees. A few semi-governmental organisations have received €173m in government funds.

 

Bill against cyberattacks discussed at House Transport Committee

The House Transport, Communications and Works Committee discussed yesterday the amending bill for the Cybersecurity Authority, which aims to improve network safety and protect the information systems of crucial infrastructure from cyberattacks. At the same time, the committee is discussing a bill to rename the Office of Electronic Communications & Postal Regulations (OCECPR) to Communications Commissioner and modernise the legislation’s provision s as well as the regulations that have to do with the staff and recruitment.

 

AmCham Cyprus announces new BoD

AmCham Cyprus announces the composition of a Board of Directors, after elections that were held on10 October. Specifically, the Board’s chairman is Haris Kakoullis (KPMG), Vice-Chairman is Georgios Georgiou (Logicom), and head Treasurer is Savvas Klitou (Baker Tilly) and members are: Aris Anastasiades (Advanced Business Solutions), Pericles Theodorides (Cablenet), Kyriacos Xenophontos (Elias Neocleous & Co), Varnavas Theodosiou (ExxonMobil), Demetris Sparsis (Hellenic Bank, Marios Kapiris (IBM), Demetris Taxitaris (MAP S Platis), Leonidas Georgiou (Microsoft), Kyriacos Kyriacou (NCR), Andreas Dermosoniades (NewCytech Business Solutions), Antonis Skoullos (Oracle), Stelios Violaris (PwC), Elena Kontemenioti (University of Nicosia) and Giannis Georgoullas (Way out communication).

 

Zeta’s message

Phileleftheros’ author reports that the labour dispute at the ports of Limassol and Larnaca has been resolved with the signing of a collective agreement. “Labour disputes can be resolved where there is good will and consensus”, tweeted Labour Minister Zeta Emilianidou. The author argues that Hellenic Bank and ETYK have been called to heed the message of the Minister. The author goes on to say that the Minister has to intervene in this specific sector. The matter has intensified and there may be an unprecedented derailment.

 

Labour dispute at Hellenic Bank becoming even more serious

Hellenic’s decision to abstain from granting incremental pay rises to its employees in 2019 and at the same time adopt a new way of calculating raises, can make the dispute even more extreme. Hellenic’s decision is unprecedented for the Cypriot banking sector, as it was taken unilaterally by the bank without the consent of ETYK, even if the bank has said that it called the union to negotiate to no avail. ETYK supports the opposite. And while everyone is waiting for the Labour Minister to intervene, as she is the competent actor when it comes to labour disputes, the Minister has remained silent on the matter. However, we cannot rule out that the Labour Minister will launch criminal proceedings against members of the bank’s Board of Directors in the coming days for violating the relevant laws: they didn’t give raises and therefore did not respect the collective agreement, which expired at the end of 2018. The Ministry has not contradicted this scenario, while it’s not certain whether they will actually move forward with this or simply use it as leverage against the bank’s management. On the other hand, Hellenic’s senior officials have been saying that they will not be backing down from the decisions they took to change the way raises are granted. There seems to be a margin for granting higher raises this year, but the decision to introduce new ways of evaluation will not change. Since the start of the dispute, people have been discussing the stance of the head of the Central Bank and the Central Bank itself. The answer is simple: Neither the head nor the CBC will intervene in the matter as it does not fall under the supervision of the banks, nor does it constitute a matter of financial stability. The supervisors have already said that the Central Bank has never intervened in labour disputes and is not going to now.

 

Keen interest in Hellenic’s “Jumpstart” programme

A keen interest has been expressed by students in the “Jumpstart” scholarships programme that was launched recently by Hellenic Bank. The programme is directed at 2019 graduates of private or public schools, technical schools as well as soldiers who have competed their military service and are about to begin their studies. The scheme will support 20 undergraduate students with an annual scholarship of €2,000 for up to four years, as long as the candidate can maintain good grades. The selection criteria include family income and educational attainment. According to Phileleftheros, a large number of students have expressed interest and applied. It is worth noting that applicants must have Cypriot citizenship or be legal residents of Cyprus, living in the government-controlled areas. HB will announce the selected students on its website. The students will receive their scholarship in two instalments.

 

Insurance coverage for every need

Hellenic Alico Life, is the Life Insurance Company by the Hellenic Bank group that was created in 2000 as a result through the strategic cooperation between Hellenic Bank and the insurance company MetLife, with their participation in the company’s share capital standing at 72.5% and 27.5% respectively. This partnership is the first serious initiative for providing banking products in Cyprus (bancassurance). Hellenic Alico Life has create a series of products that have been classified as loan insurance products and Life insurance products, not connected to banking loans. The life insurance products offered by Hellenic Alico Life were created with the sole purpose of serving the needs of the clients and aim to secure both them and their families against any outstanding financial obligations that may arise as well as offer savings solutions. They are offered directly from Hellenic’s personnel without the help of external insurance representatives, through its branch network in Cyprus.

 

 

Many open fronts for ETYK

The author argues that ETYK has many fronts open. On the one hand the union must deal with the Bank of Cyprus, on the renewal of the collective agreement, and on the other they are clashing with Hellenic for the exact same reason. On Friday, the union issued a circular arguing that it will secure the rights of the employees who will be transferred from AlphaBank to the company recommended by doValue, who will handle the problematic portfolio of the former. 2019 is ETYK’s year.

 

Banks want to rid balance sheets from NPLs

Financial institutions are slowly ridding their balance-sheet’s from NPLs with a series of actions, as they are expected to secure the future viability of the Cypriot banking system. The greatest scourge from the 2013 banking crisis, was the accumulation of a significant number of NPLs, which at the end of 2014 amounted to €27.3b or 50% of all loans. This created a negative impact on economic growth and the recovery of the banks, which constitute a key factor for economic development. Besides, the banks were complaining that for many years, their focus wasn’t to build (i.e. develop their operations, with everything that comes with this), but correct and improve the NPLs situation. Essentially, cleaning up the bank’s balance sheets, starts with the legislations that were passed by the House over the past months and concerned the sale and management of NPL portfolios by specialised companies as well as securitisations. Companies such as doValue, Apollo, Altamira and APS did not miss the opportunity to approach the Cypriot market, which due to the large number of NPLs was and still is an attractive destination for the purchase of red loans. Hellenic Bank’s agreement with APS played a crucial part in the effort of reducing the bank’s NPLs, since it was the first who proceeded to transfer and manage its NPL portfolio worth €2.3b to a third party. At the end of 2016, Hellenic’s NPLs amounted to €4.1b, while at the end of the second semester of 2019, the bank’s NPLs amounted to €1.8b. Hellenic Bank will also sell another big NPL package, with the total sum potentially exceeding €1b. Already, there is significant interest by companies who invest in this kind of assets to acquire the specific portfolio. One of these companies is Pimco (which is one of the bank’s shareholders) as well as Bain which has turned its attention to Cyprus in the past period. A similar interest is also in Helix II by Bank of Cyprus.

 

Servicers in Cyprus manage €15b-worth of NPLs

Following the conclusion of a deal between AlphaBank Cyprus and do Bank for the NPLs of the former, the NPLs managed by loan servicers in Cyprus amount to around €15b. However, only €2.8b-worth of loans have been sold to loan managers and more than €12b have been given to servicers for management only. The only NPLs portfolios that have been sold to servicers so far, belonged to Bank of Cyprus (2 package) and Hellenic Bank (1 package). Bank of Cyprus’ Helix was worth €2.7b and was sold to Apollo. NPLs worth €33m was sold to APS, while Hellenic Bank sold a €145m-worth portfolio to B2Kapital. Evidently, the banks seem to follow the European model to deal with problematic loans. After 2015, all the banks chose companies specialising in servicing NPLs. In the first years of tackling NPLs, the Cypriot banks managed to reduce the loans, but they realised that the fewer they became, the harder their job. As such, international companies like Altamira, APS, Pepper, Apollo (which made Gordian Holdings) and B2Kapital. These companies essentially manage all the NPLs of Cyprus, except AstroBank’s NPLs which has chosen an in-house solution in order to deal with them. It is expected that another company will be added to the list, as doValue will suggest a specialised NPLs servicer, to which AlphaBank’s current business will be transferred. The portfolio it will take up amounts to €3.2b.The deal is expected to be completed within the first quarter of 2020 and the management of the portfolio will start immediately after. The Italian doBank based in Verona known as UniCredit Credit Management Bank until 2015 and servicer announced in the start of the year that it bought Altamira Asset Management.

 

Bank of Cyprus: 400 less employees and 13 fewer branches

Kathimerini Economy reports on the voluntary retirement scheme implemented by Bank of Cyprus in 2019, which resulted in more than 400 bank employees departing from the bank and receiving a compensation of up to €200 thousand.  The bank’s general restructuring and digital transformation scheme predicts the closure of 13 branches by Christmas. According to Kathimerini’s calculations 3,540 people departed from the banking sector since 2013 and after 2018, with the closure of the Co-op. As of tomorrow, Monday, 21 October, this number will rise to 4,000 after the BoC managed to reduce its employees by 400 people. According to senior officials at the bank, this number is expected to be even higher. From the beginning of 2013, 10 voluntary retirement schemes have been put forward and Bank of Cyprus, Hellenic Bank, Cyprus Co-operative Bank and AlphaBank Cyprus proceeded with such schemes. However, many people were transferred from banks to asset management companies, as a result of the effort to reduce NPLs. These employees are considered bank employees and their rights are protected by ETYK.

 

Cyprus-US investment relations and the future

Over the past years, Cyprus has managed to attract international investment for the implementation of large-scale projects. The American factor has been rather strong in various sectors. Cyprus’ service model has drastically changed, and Cyprus is used not only as a base to carry out investments abroad, but also direct investments in the country. The American companies ExxonMobil and Noble Energy are already participating in the country’s energy activities and their presence has brought more American firms which will support the bigger energy firms, such as Halliburton. This past month, the US ambassador in Cyprus addressing the business dinner of the American Chamber of Cyprus, said she was certain that as the Cyprus energy programme develops, more US companies will expand their activities to Cyprus. As it comes to the hotels sector, US investment firms purchased the Aphrodite Hills hotel. Moreover, the tourist resort Beau Rivage was acquired by NCH Capital, which is active in Eastern European countries, including Greece and Cyprus. In the banking sector, US institutional investors (under Wilbur Ross) invested €400m in Bank of Cyprus, with this being one of the biggest inflows of foreign capital in Cyprus. At Hellenic Bank, around €40m was invested by the American investment firm, Third Point. The investment firm Apollo entered into an agreement for the acquisition of an NPLs-assets package from Bank of Cyprus, worth €2.8b.

 

The biggest player

The article argues that the fact that Alpha Bank has chosen Altamira to manage its problematic assets worth €4b, has come to shake up the situation. It has become the largest NPLs servicer in Cyprus, while there are no more suspicions around its role in the sector. One of the biggest banks in Greece, has chosen Altamira as the servicer for its loans in Cyprus. This says something about the market and anyone who was discussing its role.

 

MoF needs to settle pending matters

Now that the Minister of Finance’s term is ending, it would be preferable if he also completed some pending issues, such as KEDIPES. The Co-op is something that has marked the Minister’s course. One would expect that KEDIPES’ restructuring scheme would end somewhere near the end of the MoF’s term. However, for this to happen, BDO must first complete its study. If the relevant deadlines were met, the decisions would have been taken over Georgiades’ term of and the matter would then close. The same goes for Altamira and the terms of its contract. This is a pending matter that has to close, so that its work can continue. With this situation, its work on NPLs is not facilitated.

 

Those who stayed at the bank

The senior officials at Bank of Cyprus are rather satisfied by the results of the Voluntary Retirement Scheme as they got rid of 10% of their personnel and reached the targets of the scheme. The issue is now with the ones who have been left behind, who are seeing that their time is limited and their terms of employment have become more difficult. What is demanded by each one of them has increased, as have the targets that they must cover in order to satisfy the upper echelons of the Bank. With this situation, the number of people who wanted to leave the bank could be higher than the ones who actually agreed to leave the bank. When presented with the next opportunity, they may take it.

 

BoC has integrated compliance in its strategy

Over the past years, the way compliance is implemented has been quickly transformed as it has been affected by new, complex rules and controls, technological developments and malignant threats such as cybercrime. All these and many more were presented at the 5th International Compliance Forum that was held on Friday, 4 October 2019 with the participation of distinguished international speakers. The Forum was presented by Bank of Cyprus. US ambassador in Cyprus, Judith Garber addressed the conference, referring to the progress of Cyprus in matters of compliance. Marios Skandalis, BoC’s Director of Compliance, chairman of the Cyprus Integrity Forum (CIF) and vice-chairman and founding member of the Association of Certified Fraud Examiners (ACFE) in Cyprus, at a speech at the conference stressed that “strong and effective compliance operations constitute a necessary preparatory stage for the implementation of a corporate ethical culture”.

 

The protection of the environment is our priority

The protection of the environment is one of the most crucial conditions for the sustainable development and one of the main pillars of the Corporate Social Responsibility strategy of every environmentally-sensitive organisation. The Bank of Cyprus, one of the biggest organisations on the island, is fully aware of its responsibility against the environmental challenges and consequences of the usage of non-environmentally friendly products and services. This is why it has adopted a comprehensive environmental policy programme with a view to reduce its negative environmental consequences. The Bank is improving its ecological performance with a series of measures, such as the efficient usage of energy, water and paper as well as a green IT initiative and the replacement of business trips with tele-conferences.

 

The salaries and benefits of public and bank employees

Public employees and bank employees still have satisfactory salaries and benefits. Apart from labour security, the first category of employees receives subsidies that are still significant despite going through the financial crisis. The second category of employees may be threatened by the changes in the banking sector, but still enjoys benefits compared to other employees of the private sector. Phileleftheros presents the additional benefits that these two categories of employees may have compared with the rest. The bank employees still have lower interest rates for loans. According to the latest agreements that expired, the interest rate on housing loans for bank employees stood at 1.6% for student loans, 1.4% for auto loans, 1.4% for wedding loans, 1.4% for financing, 1.4%  for overdraft. According to the agreements that were concluded with ETYK, the bank employees who are eligible for housing loans can receive housing loans (up to €130,000), without this exceeding four annual salaries. The repayment period is 20 years, and the loan must be repaid before the employee’s retirement. According to the current procedures, all permanent employees are allowed to receive housing loans.

 

Artemis helps banks assess creditworthiness and prevent the worst

The banking Information System, Artemis, maintains the credit profile of customers, banks and credit acquisition companies. The system records the loans, credit cards and current accounts of people transacting through banks. The banks provide Artemis with information on the credit facilities of guarantors, providers of collateral and individuals who are linked to the primary debtors. The Director-General of Artemis, Giannis Tomasides, told Phileleftheros that Artemis’ archive aims to help the banks and credit acquisition companies assess the creditworthiness of current and potential borrowers and connected persons in order to more effectively manage their credit and other relevant risks.

 

Survey: The public has not fully understood ESTIA

According to a survey carried out by IMR at the University of Nicosia on behalf of Simerini Sunday, 67% of the citizens state that they have a limited or no understanding of the conditions and provisions of the government’s ESTIA scheme. At the same time, 59% of citizens believe that the current shape of the Scheme does not cover the needs of the borrowers, while 26% of citizens believe that the most significant problems emerging from the current shape of the Scheme, is that the taxpayers will be burdened as well as the bureaucratic problems in the submission of the application (21%). 42% of the citizens believe that the banks stand to benefit more from the scheme, while 28% believe that the strategic defaulters will benefit from the scheme. Only 17% of respondents believe that the borrowers will benefit from the Scheme. At the same time, the majority of citizens (74%) believe that an extension must be given for borrowers to apply for ESTIA. The public is divided as it comes to the viability of the Scheme, while 68% of citizens are unaware whether they are eligible to join the Scheme.

 

 

 

Stakeholders pushing for relaxation of “golden passports” criteria

Reuters’ story about the relatives and associates of the Cambodian dictator and prime-minister who reportedly purchased Cypriot passports, has burdened Cyprus’ international image confirming the discriminatory comments in the international press about Cyprus’ investment programme. The matters that have arisen, as well as the questions about the conditions under which the Cambodian members of the elite acquired Cypriot passports/European travel documents, touch upon the centre of the Cyprus Investment Programme that has been running since 2013. It is a programme that was amended five times, in order to bring it closer to the government’s initial target which was to strengthen the investment sector. The government’s latest move in February 2019, to strengthen the framework of requirements for the acquisition of investment passports, closed more gaps. However, at the same time the government’s initiative prompted certain stakeholders to complain as they don’t share the government’s concerns with regards to the international pressures. However, any disagreements that were expressed about the new criteria that were implemented, are just the tip of the iceberg and behind the scenes, certain stakeholders are pushing for the relaxation of requirements and/or control of approvals.

 

The government is throwing its money away

Phileleftheros reports that many private companies based in Cyprus (Eurobank Cyprus, PwC Cyprus, EY) prefer to rent offices rather than purchase or build their own. The article goes on to say that many banks are also open to the potential of selling their privately owned buildings and even their central offices. The author argues that these companies have potentially assessed that building your own offices is not a cost-effective solution. It could be that with long-term rentals they have less things to worry about and less taxes. The article goes on to say that while some organisations have chosen to build or purchase offices, these are very few especially after the financial crisis. The author wonders why has the Cypriot government decided to purchase dozens of properties that will accommodate its services. The author argues that neither the public finances justify such great investments in immovable properties. The Ministry of Finance, called on owners in various municipalities in Nicosia and Limassol to express their interest to sell to the government. The first call for the expression of interest includes 14 buildings that will accommodate over 2 thousand employees.

 

State granted tax exemptions amounting to €408.2m

The state granted tax incentives to 475,588 taxpayers amounting to €408.2m during FY2016 and 2017. Essentially, these are tax expenditures and have to do with the government’s costs due to tax deductions, the reduction and exemption of taxes, tax returns as well as the imposition of reduced tax rates. The data included in the Tax Expenditure Analysis Report, shows that out of more than 474 thousand taxpayers, 12,003 taxpayers have to do with VAT amounting to €159m. The report records 16 cases of tax expenditures that were valid as of 30 September. Specifically, 454,621 natural persons benefited from tax exemptions and deductions amounting to €220m on income tax.

 

Bank of Cyprus to move forward with organic restructuring

Following the departure of around 400 employees from the Bank of Cyprus through the voluntary retirement scheme, the group will enter a phase of restructuring. After the scheme, the bank will proceed with a general restructuring of its organic structure. According to the initial plans that have been drafted, some units will potentially be abolished entirely, due to the full adoption and implementation of digital technologies. A source from the bank has said that the restructuring will follow the departure of 10% of employees. The bank’s management is expected to submit a proposal to the BoD on its next steps and according to the paper’s sources, it is not ruled out that the bank will accept more applications for departure, related to the restructuring scheme. The scheme that the employees had to opt in, is the fourth in row after the banking crisis of 2013. It was drafted in coordination with ETYK and foresees among other, ex gratia compensations of up to €200K. According to the provisions of the scheme for the people who chose to voluntarily depart, must be first approved by the Bank’s management.

 

First test for e-auctions

Cyprus is entering the era of e-auctions, as it will carry out its first real estate auction on Wednesday. Most of the properties that are up for sale belong to banks and credit acquisition companies as they have passed under their ownership, after debt-to-asset swaps. Moreover, within the coming days, it is expected that a decree will be issued on e-auctions. The first e-auction includes 61 properties, of which 51 our houses. Moreover, the starting price for each property starts at €30K and goes up to €750K. According to market experts, this auction will be the first test of e-auctions.

 

Borrowing costs for RoC at historically low levels

The Republic of Cyprus’ borrowing costs have remained at historically-low levels, despite the rise of bond yields that was recorded worldwide from the end of August onwards until today, mainly due to the trade tensions between the US and China and later between the US and the EU as well as concerns about the slowdown of global economic growth. According to information analysed by CNA, 10-year government bond yield with a coupon of 2.38% that was issued in September 2018 and matures in September 2028 closed on Friday 18 October at 0.451%. It should be noted that the historically lowest yield of the 10-year bond was marked on 20 August at 0.344%, while in the beginning of the year it stood at 2,238%.

 

Georgiades satisfied from Washington meetings 

The Cypriot mission led by the Ministry of Finance, Harris Georgiades and the head of the Central Bank, Constantinos Herodotou, returned to Washington yesterday, after participating in the IMF-World Bank Summit. Via Twitter, the Finance Minister said that himself, the head of the Central Bank and his team met with rating agencies, investment banks, IMF representatives and the American Deputy Minister of Finance. He said that the meetings had a positive result.

 

Window to bribes and preferential treatment

Phileleftheros’ article reports that the fact that the gaps in the public consultation procedure during the preparation of bills, leaves the window open to bribery, preferential treatment, conflicts of interest and non-transparency. It is a gap that has to do with the regulation of public consultations, during which every organised body, stakeholder and interested citizen will have the potential to express and justify their opinion, co-drafting the state’s policies (at least during the preparation stage). At the same time, a relevant bill that was prepared and submitted by Green Party MP, Charalambos Theopemptou remains in the parliament’s drawers since November 2017.

 

The president ranks fourth

Politis reports that the state payroll hasn’t established any pay grades that would determine the salaries of 192 state officials, causing great variations and inconsistencies in the way they will be paid in 2020. It seems that the annual salaries of the state officials start from €42,697 (MPs and religious representatives) and go up to €126,237 for the Attorney-General and the Supreme Court judges. When however, one examines their gross annual salaries compared to their net salaries, after adding the index, the various subsidies and deducting flat-rate costs and income tax, the situation has changed and members of the Commission for the Protection of Competition (CPC) receive the least net salaries (€40,403) while MPs receive net salaries amounting to €51,813. Politis also reports that as it comes to net annual salaries, the President ranks fourth out of all state officials, with €15K less than the Attorney-General and the Supreme Court President and Judges. The article also says that the Ministers receive lower salaries than the Directors-General of their Ministries.

 

New tariffs at Limassol port

In its bid to ensure a swifter service in the loading and unloading of containers at Limassol port, the Cyprus Chamber of Commerce and Industry (CCCI) seriously negotiated both with the Transport Ministry as well as operator Eurogate, for the continuation of satisfactory service times at the lowest possible cost. The CCCI’s aim was to ensure the smooth, unhindered, swift and efficient operation of the port’s container terminal, with all the positive consequences this will entail for the trade sector (imports and exports). The CCCI’s efforts have paid off, given that with the cooperation and constructive approach of the Chamber, the relevant additional cost for swift service was reduced from €13.50 for a full container (imports and exports) which was what Eurogate was demanding, to just €4. The Transport Ministry also contributed significantly to achieving this low price. Furthermore, the CCCI managed to ensure that low-value containers (such as bentonite, umber, recyclable materials etc.) will be exempted from the new tariff. The new tariff came into effect as of 18 October.

 

Altamira: The expensive properties it sold in 2019

Altamira’s asset management team concluded significant deals in 2019, for the sale of highly-valued properties that the company recovered in debt-to-asset swaps. It should be noted that in certain cases, Altamira’s team proceeded in different actions that either reduced the value of the property or facilitated the attraction of investors. InBusinessNews presents some of the most expensive properties in Altamira’s portfolio that were sold in 2019.  The article goes on to say that Altamira is expecting to launch the process to find an investor for the emblematic SODAP complex in Limassol over the next few days. SODAP is one of the highest-valued properties Altamira has in its portfolio. It is expected to seek an investor by opening a bidding process through its online platform. SODAP is a complex of factories that is considered one of the most important samples of Limassol’s historical industrial architecture. It is located in one of the most popular and central locations of Limassol, in the Tsiflikoudia area. More specifically, it is located between the new Limassol port and the marina, while it is just a few minutes away from MyMall and the under-construction City of Dreams Mediterranean casino-resort. Even though the price of the property was not published yet, interested buyers will have the opportunity to bid. The bidding process will last one month.

 

  1. Anastasiadou: These are the development works that will improve citizens’ lives

There has been unprecedented progress in large-scale public development works, which are either underway or are being promoted for implementation. It is worth noting that 50 projects worth almost €1b have been included in the 2020 state budget. Transport, Communications and Works Minister Vasiliki Anastasiadou told InBusinessNews that a large number of projects, worth almost €167m, have been completed over the past few years. The most recent projects that were completed in 2019 were the road parallel to the new Limassol port, the completion of Aglandja Avenue in Nicosia and part of Larnakos Avenue, the renovation of the Nicosia Municipal Theatre and the upgrade of the Pernera road in Paralimni.

 

Cyprus-Greece ferry link preparing to go to Brussels

Feverish preparations are underway at the Deputy Ministry of Shipping with the aim of preparing Cyprus’ request to Brussels for the Cyprus-Greece ferry link, with a proposal that is as substantiated as possible. At the same time, the procedure is underway to prepare the technical standards that the relevant ferry must comply with to carry out the routes. Speaking to Alithia newspaper, the deputy ministry’s permanent secretary, Costas Iacovou, said both procedures are running in parallel in order to meet the deadlines that have been set. He said these were complex and multifaceted issues, and the deputy ministry needed to be especially careful both in terms of the arguments it will put forward to Brussels, and the characteristics that the ferry will have. “It is not as simple a procedure as it may sound,” said Iacovou, adding that they were being extra cautious as they want the effort to be successful. He said the deputy ministry was in consultation with the State Aid Control Office and the State Treasury to ensure that all aspects are covered. There will also be contacts with the relevant Shipping ministry in Greece in the near future, he said. As for the timeframes, Iacovou said the aim is for the request to be submitted to Brussels in December; that is a request for the European Commission’s authorisation for the state to fund the project. Another objective is for the authorities to open tenders in January for the ferry and for the ferry link to be up and running by the summer of 2020, provided the green light is given by the EU.

 

15th Cyprus Summit: Cyprus Thriving unimpeded, Europe in need of a new narrative

It will be held November 4-5, 2019 at Hilton Park in Nicosia. More than 40 distinguished speakers from the USA Europe have confirmed for the 15th consecutive year including President of Cyprus Nicos Anastasiades, Klaus Regling, Managing Director, European Stability Mechanism ESM, Wess Mitchell, Former US Assistant Secretary of State for European and Eurasian affairs, Don Bagley, Vice-president exploration, and new ventures Europe Russia Caspian, MENA, ExxonMobil International, and Elias Kassis, Vice-president North Africa MENA division, Total Exploration Production, and Cyprus ministers, Nicos Christodoulides, Minister of Foreign Affairs, Yiorgos Lakkotrypis, Minister of Energy, Commerce and Industry, Savvas Angelides, Minister of Defence among others.

 

 

The paradox in arrivals

Despite the hoteliers’ constant complaints, as well as the closure of Thomas Cook, tourist arrivals broke a new record in September, Phileleftheros reports. Cystat said that there were 524,707 arrivals, compared with 520,138 in September 2018, recording a 0.9% increase.

 

Small hotels reject the agreement

Labour peace in the hotel industry is effectively hanging by a thread, Kathimerini Economy reports. Having received the green light from the trade unions, the Labour Ministry is now waiting for the response of the Cyprus Hotels Association (PASYXE) and the Association of Cyprus Tourism Enterprises (ACTE). The two latter’s official decisions are expected to be reached today (Monday), following a joint general assembly. The paper reports that the hoteliers appear to have become divided into two camps: those who appear to consent to the text to the initial agreement that was reached in August, and those who have strong reservations and concerns on the impact it will have on their businesses. There is a 50-50 chance the hoteliers will give the green light to the collective agreement, PASYXE Famagusta president Doros Takkas told the paper, while other sources said that it is going to be a very close call.

 

Air connection between Paphos and Alexandria

An event was held in Alexandria on Saturday night (19 October) to mark the agreement between Paphos and Alexandria to become twin cities, which was signed last eyar. Paphos Mayor Phedonas Phedonos said that a direct air connection between Paphos Airport and Borg El Arab International Airport, Alexandria, is expected to be up and running in six to nine months. He added that the two town’s relations are expected to be developed in the sectors of education, cu;lture, economy and tourism.

 

Luxury within nature

The innovative project Citrine Estates, which will be located next to the under-construction City of Dreams Mediterranean casino-resort in western Limassol, is expected to become an attraction pole for investors from both Cyprus and abroad. The project will consist of luxury residences of the highest standards, while it will be surrounding by nature, offering relaxation and serenity.

 

Effort to tidy up Airbnb

The legal framework for short-term rentals such as Airbnb is expected to be discussed at the House this week. A law proposal has been tabled by MPs Averof Neophytou and Elias Myrianthous, aimed at regulating the licensing and specifications of such accommodations. The discussion of the law proposal, which affects around 20,000 short-term rentals, is expected to be completed this week in the presence of Deputy Minister of Shipping Savvas Perdios.

 

Altamira: The expensive properties it sold in 2019

Altamira’s asset management team concluded significant deals in 2019, for the sale of highly-valued properties that the company recovered in debt-to-asset swaps. It should be noted that in certain cases, Altamira’s team proceeded in different actions that either reduced the value of the property or facilitated the attraction of investors. InBusinessNews presents some of the most expensive properties in Altamira’s portfolio that were sold in 2019. The article goes on to say that Altamira is expecting to launch the process to find an investor for the emblematic SODAP complex in Limassol over the next few days. SODAP is one of the highest-valued properties Altamira has in its portfolio. It is expected to seek an investor by opening a bidding process through its online platform. SODAP is a complex of factories that is considered one of the most important samples of Limassol’s historical industrial architecture. It is located in one of the most popular and central locations of Limassol, in the Tsiflikoudia area. More specifically, it is located between the new Limassol port and the marina, while it is just a few minutes away from MyMall and the under-construction City of Dreams Mediterranean casino-resort. Even though the price of the property was not published yet, interested buyers will have the opportunity to bid. The bidding process will last one month.

 

Citrine Estates: Luxury in nature

Citrine Estates wishes to become a pole of attraction for investors based in Cyprus and abroad. The project will be completed next to the under-construction casino-resort City of Dreams Mediterranean in West Limassol, which is being transformed into a beautiful, friendly and attractive urban landscape. “Offering a holistic experience, the project responds to the needs of the buyers for luxury high-end properties, while it offers a heaven on earth for relaxing in nature”, the vice-president of Citrine Estates tells Phileleftheros Insider.

 

Gamblers a product of the right-wing government

Gnomi refers to the study conducted by the Research Centre of Alexander College, which was launched last November and completed this January, on the youth’s perception of games of chance and pathological gambling. According to the study, 12% of Cypriot students between 18-35 exhibit signs of pathological and problematic gambling. The article criticizes the government, which assumed that creating a casino would be a part of the country’s “development”, despite the fact that experts warned them against allowing the opening of a satellite casino in Engomi, in Nicosia close to two private universities with thousands of students. The article concludes that everything is being sacrificed so that the government earns more money, and the state doesn’t even care that young people end up becoming gamblers.

 

A project that will rejuvenate the Greek economy

Mohegan Gaming and Entertainment (“MGE”), in partnership with GEK TERNA, unveiled INSPIRE Athens, its concept for the first Integrated Resort and Casino (“IRC”) in Greece. The Chairman and CEO of Mohegan Gaming Entertainment (MGE) said that the project will reposition Athens as a worldwide pole of hospitality and entertainment. According to Mr Kontomerko, INSPIRE is estimated to create more than 7.000 jobs in the region during and after construction, including direct, indirect, and induced, while it is expected to increase international tourism in the Attica region by at least 10%. The investment will be implemented with respect to the historic, cultural and environmental footprint of Greece and aims to inspire the new identity of the country, prompting the return of the thousands of young people who left the country due to the financial crisis.

 

 

Youth is addicted to gambling according to new study

Alexander College carried out an extremely interesting and revealing study, which must be utilised by the state. It is a study, which reveals that drugs aren’t the only dangerous addiction threatening our youth, as many people are addicted to gambling. More than 1 in 10 students, are pathologically involved in gambling. The most worrying finding of the study is that the young people inherit their addiction to gambling from their parents. The research team that was involved in the study, included Costas Christodoulides, coordinator/director of the Research Centre of Alexander College, Panayiotis Elia, research associate, Pavlina Antoniou, consulting psychologist, Nico Karfakis, Business Administration and Petroula Hadjiphoti, clinical psychologist.

 

Patients with mental health problems are second-class citizens

In an announcement on the occasion of World Mental Health Day, PASYDY’s mental health nursing staff highlighted the lack of coordination and collaboration between mental health services in Cyprus, resulting in patients with mental illnesses to be treated as “second-class citizens”. They reported problems including lack of available hospital beds and rooms, resulting in multiple patients staying in one room, as well as a lack of important psychiatric medicines. Also, they report that there’s no pathologist in Athalassa Psychiatric Hospital as he was transferred to a health centre.

 

Health centres being upgraded

Health centres are being renovated, modernised and their equipment is being upgraded in order to expand their services. Although the spotlight is continuously focused on the problems of the public health sector, the procedures of restructuring their services are ongoing and changes have already started in Nicosia, and they will gradually expand, according to schedule, to all cities. The first important change was implementing the procedure of scheduling appointments for state GHS doctors. Also, nurses were sent abroad for training in health centres of other European health systems. According to Phileleftheros’ information, scheduling appointments has already helped with decongestion in health centres. Reportedly, there’s also been a reduced amount of complaints by citizens about OKYPY’s health centres over the last month. OKYPY is moving forward with increasing its staff, in order to improve their services.

 

Doctors refusing parents

Health Minister Constantinos Ioannou, confirmed information that some doctors are not allowing parents to be present when they carry out medical examinations on their underage children, violating the relevant protocol. This issue reached the House by MP Giorgos Perdikis following complaints by parents of underage children, that doctors are ignoring the relevant protocol and don’t allow the parents to be present – not even for drawing blood for a simple blood test.

 

Personal dentist in the GHS

As it appears, June 2020 and onwards, GHS’ beneficiaries of all ages will be able to visit a dentist registered in the system once per year for a teeth cleaning session. They’ll also be able to undergo a regular check-up in view of identifying serious diseases in a timely manner. The Cyprus Dental Association has entered discussion with the HIO over dental coverage in the GHS. However, dentists are drafting a letter to the HIO, to speed up the discussion procedures. The discussion will include the budget issue of €10m that dentists claim is insufficient to even cover the basic dental services.

 

€1000 fine for illegal possession of duty-free tobacco products in Avgorou

Following information, police officers searched specific premises in Avgorou and found 11 duty-free cigarette packs and 500 grams of tobacco. The woman who works at the establishment as a manager was fined with an extrajudicial settlement of €1000 for the illegal possession of duty-free tobacco. The products were confiscated and will be destroyed according to the proper procedures.

 

How do Cypriot companies last through the years

The article talks about various Cypriot companies, which have been around for dozens of years and continue to successfully lead their sectors. Times change; a cliché but currently, it is especially true. Despite all the changes, there are a few things which have managed to stand the test of time for dozens of years, and not only survive but pioneer in their sector. Many companies in Cyprus were established dozens of years ago but have successfully withstood all the changes in the Cypriot society as well as coped at a time of technological revolution. The author goes on to mention many well-known and successful companies including Photos Photiades Distributors Ltd, which only continues to grow. The Photos Photiades Group was established in 1942 but is now one of the largest and most dynamically developed Cypriot business organisations. The group is a leader in beverage production and distribution, trading tobacco products, land development, the insurance industry and the energy sector. It’s successfully operating in Cyprus, Greece, Romania, Croatia and Slovenia.