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Daily Press Review – 22/8/2019

The 8 new contenders for a position on Hellenic Bank’s Board  

There could be some partial or radical changes to Hellenic Bank’s Board of Directors following the EGM of shareholders that will take place on 28 August. And this is because there are eight new faces contending for a seat on the Board, on top of the existing Board members, as well as the fact that the bank’s Board chairman, Youssef A. Nasr, has withdrawn his candidacy. There are a number of powerful names among the candidates, the site reports, coming from the local as well as international banking sector. And the bank’s shareholder structure has changed significantly in the recent past and the new “players” are seeking to boost their presence or acquire a say in the bank’s management. The current shareholders are Demetra Investment (21%), Wargaming Group Limited (20.2%), Poppy Sarl (17.3%), Third Point (12.6%), ETYK Provident Fund (6.3%), Senvest (5.1%) and others (17.6%). The site goes on to present the bios of the eight new contenders, who are: Zion Bahloul, John Charles Chrystal, Marco Comastri, Ioannis Georgoulas, Marios Maratheftis, Kyriakis Pilia, Michalis Spanos and Chistos Themistocleous.

 

Hellenic and BoC in talks with Pimco to sell NPLs

Hellenic Bank appears to have confirmed information that has been leaked over its intentions to sell a red loan portfolio to Pimco. However, according to more leaked information published yesterday by StockWatch, the bank is in consultations with other investment funds too, without any final decisions having been made.  HB’s management was asked by the Cyprus Securities and Exchange Commission to provide an update on media reports that it intended to sell a loan package to Pimco. In its response, the bank appeared to more or less confirm that the American investment fund had shown an interest, but stressed that no final decisions had been made. CySEC intervened because HB’s share was being negotiated on the stock exchange, without the Bank officially responding to the reports; something it has still not done so far. StockWatch notes that one of HB’s major shareholders is Poppy Sarl, which is affiliated with Pimco. It also notes that Pimco was assigned to prepare a report on the local banking system’s capital requirements for the period 2012-2015. The report showed that the vast majority of capital needs, totalling €9b, were at ex Laiki and Bank of Cyprus (BoC). Meanwhile, CySEC also sent a letter to BoC’s management, as it has received information that BoC too is in talks with Pimco to sell an NPL portfolio. The bank has not responded yet. CySEC chairwoman Demetra Kalogerou confirmed to StockWatch that the commission has made recommendations to both banks that they should provide the relevant information. She added that CySEC was closely monitoring the developments and if there are any agreements to sell loans, they will be examined based on the impact, positive or negative, and how these will affect the banks’ balance sheets.

 

Climate is changing for deposit rates

ECB data has highlighted the changes that have been brought about in the deposit rates environment, what with their substantive reduction which has led the vast majority of households and businesses to receive very little for depositing their money at the banks. Businesses are in a particularly unfavourable position now as many banks across the EU have started charging them for keeping their deposits, which is something that has also started in Cyprus with Hellenic Bank. The Cypriot banks are concerned about their excessive liquidity and the costs of saving deposits at the ECB, which means they are preparing more aggressive moves to reduce their deposit rates. These moves, however, are mainly expected to affect businesses, as even countries such as Germany are hesitant when it comes to charging households for their deposits.

 

Hellenic Bank: Selling Mall in Greece

Hellenic has put the Olympia Mall in Trikala, Greece, up for auction via APC, with an asking price of €3.5m. The real estate is 12km north of Karditsa, 10km south of Trikala and 50km west of Larisa. The property is directly linked with the local road network, which offers swift and easy access to all the surrounding towns and regions, as well as the Thessalonica-Athens highway.

 

Nicosia Mall for sale

Bank of Cyprus is very close to selling its stake in Nicosia Mall. Its negotiations with a consortium of companies, which have been underway for quite a while now, appear to be in advanced stages and there may even be signatures in September. BoC became involved in the mall when it decided to finance the completion of its construction. It had been left half-finished because of the economic crisis, which led to BoC acquiring the majority of its share capital. With the agreement that appears to be shaping out, the bank will sell its 64% stake for €96m, according to leaked information.

 

E-payments at all-time high

E-payments in Cyprus reached an all-time high last year, increasing by 500% compared with the previous year. Last year, the Tax Department implemented the obligatory payment of taxes through JCC. VAT is also paid online; it has always been paid through the banks, and through internet banking as well.

 

Deceleration of Cyprus’ growth rate

Cabinet yesterday discussed the state’s fiscal policy and the economy. The Finance Minister said there was a positive growth rate in the first half of the year, despite a deceleration compared to the previous few years. But at 3.3%, it continues to be around three times the Eurozone average and is very satisfactory. Also, public debt is on a downward trend, following the sudden spike following the Co-op acquisition, and is now at around 96%.

 

 

 

The Audit Services are expecting court proceedings on Larnaca port

The Audit Services requires that the basic contractual conditions for the Larnaca port and marina will not be substantially altered, if they are to move forward to asses and negotiate with consortium KITION OCEAN HOLDING, based on the proposal they’ve submitted through the procedure of direct negotiation with one potential investor without a competition. MP Giorgos Perdikis had asked the Audit Services how the Ministry of Transport is monitoring this procedure, following the requests of the Cyprus Ports Authority, and this is how they responded to his questions. In their letter, the Audit Services reassures the MP that they monitor the developments of this situation, however, they will not make any additional moves for now, as they await for the outcome of CPA’s legal appeals.

 

Sewerage underway

Last month they begun earthworks and next Monday they will begin the main works with installing a contractor at the building site in order to build the West Limassol water treatment in Polemidia. This will be the second sewerage project, which is implemented with an 8-years delay due to reactions and the financial crisis. This unit will serve 25000 citizens, 10000 households as well as large projects in West Limassol such as the casino – resort and the future works in Fasouri. The project is expected to be completed by January 2021.

 

Bellair Residences

The luxury “Bellair Residences” is a new housing complex that is being developed by Aristo Developers in the Agios Athanasios hills in Limassol. The project will include luxury, three-bedroom residences, with large outdoor spaces, private pools and green areas, in complete harmony with the surrounding natural environment. The villas will have a panoramic view of the sea and Limassol town. The complex is a stone’s throw from the town centre, offering immediate access to all modern services such as schools, malls, healthcare services, but also a multitude of restaurants, luxury hotels, entertainment venues, organised beaches as well as the town’s casino-resort.

 

Two contenders in combat position

With the Greek government sending out the clear message that there will be no new extensions to the 30 September deadline in the competition to grant a casino licence for Hellinikon, the two main contenders are stepping up their presence in the country. Hard Rock International chairman Jim Allen is arriving in Athens this week, while the joint venture Mohegan Gaming & Entertainment with GEK TERNA has put together the delegation that will engage in the procedure for the casino licence. These are the two contenders left in the tender process; American Caesars and Malaysian Genting had also been a part of it, but are no longer in the running. Based on the terms of the tender, it will be carried out in just one stage. So, on 30 September, the bidders will submit their total offer, which will include their business plan as well as the sum they are willing to offer the Greek government for the casino licence. The licensee will have exclusivity rights in the Attica Region, except from where the Parnitha Hellenic Casino is. Interested bidders in the Hellinikon Casino must have capital of at least €200m on average over the past three years, as well as annual revenue of at least €400m over the same period. If they are investment firms, they have to have managed over €400m of capital over the past three years. As for the government, efforts are underway to resolve all the issues that are pending with Hellinikon, and a meeting of the Central Archaeological Council will be held today. The bi-ministerial committee for Hellinikon, which convened on Monday, is expected to meet anew on Friday. Straight after, the final meeting of the Central Administration Council will take place so the three ministerial decrees that are pending for Hellinikon can be approved. It will also clarify the picture regarding the Integrated Resort Casino (IRC). Under the leadership of Jim Allen, Hard Rock International has expanded its international presence from 46 to 74 countries, it has increased its Hard Rock Cafes from 125 to 185, its hotels from nine to 27 and its casinos from four to 12. Hard Rock International was also a member of the consortium that won the licence for City of Dreams Mediterranean in Cyprus, but it later departed.

 

Continuous collaboration with UCY Medical School

The collaboration between the University of Cyprus’ (UCY) Medical School and Health Ministry was renewed for another six months, and a provision for an additional six (until Parliament votes for the relevant bill). Following the recent renewal of their contract, both parties reaffirm their commitment to support the HIO, the GHS and state hospitals, by upgrading health services, as well as facilitating research and practical exercises for both academic and health professionals.