Officials from Hellenic Bank and the Cyprus Co-operative Bank (CCB) have kickstarted the process for the transfer of business of the CCB to Hellenic, following the agreement between the state-owned CCB and Hellenic announced last month.
Officials from both banks told CNA that division directors began meetings to prepare the transfer which is expected to be completed by the coming September.
According to the agreement reached between the state-owned CCB and Hellenic, Hellenic Bank will acquire a balance sheet of €10.3 billion, comprising a portfolio of primarily performing loans (net loans: €4.6b), Cyprus Government Bonds (€4.1b), cash (€1.6b), customer deposits (€9.7b) and certain other current liabilities and assets. Hellenic will also absorb 1,100 from the CCB’s total 2,700 employees, as well as approximately 73 branches.
In August Hellenic Bank in August will convene an EGM which will approve a €150m capital raise, expected to take place during the fourth quarter of 2018.
Hellenic has announced it received irrevocable undertakings by its major shareholders to approve the capital increase which is essential to obtain the green light by the ECB’s Single Supervisory Mechanism.
Banking officials from both banks said they aim at a smooth transition especially for the customers of the CCB. Officials are examining issues concerning system integration and the branch network of the consolidated entity.
Last week Moody’s rating agency announced it placed Hellenic Bank and the CCB on review for upgrade following the Cypriot authorities approval of Hellenic’s offer to acquire CCB’s balance sheet consisting of healthy assets, all of its customer deposits, some other liabilities and equity.