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President asks commissioner to probe CCB’s offsetting of accounts

September 6, 2018 at 11:12am
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President Nicos Anastasiades on Thursday asked financial commissioner Pavlos Ioannou to probe the reconciliation of non-performing loans with money from clients’ current accounts by the Co-op Cyprus Bank days before its operations were transferred to Hellenic Bank.

Moreover, Finance Minister Harris Georgiades has asked the successor agency of the former CCB, known as SEDIPES — to check and confirm the procedure followed and make corrections where necessary.

It follows a spate of complaints by CCB clients that money from their current accounts had been transferred to loans even without their prior knowledge.

Hellenic Bank has clarified that the move was made by the CCB before the accounts were transferred and that it would try to facilitate customers as best it could.

According to Phileleftheros the situation is chaotic, with 10,500 current accounts affected. It added that according to some reports, guarantors’ accounts were also affected. As a result affected individuals cannot use their credit cards or cheque books.

The CCB reportedly did not inform customers by letter that it would transfer money from one account to another but took out an announcement in the press clarifying how it would set off loans with money from current accounts.

Ioannou said that the CCB had set off the accounts of recipients of  minimum guaranteed income, pensioners and single parents who receive benefits from the state.

In one case, the CCB took money from the provident fund of company employees to cover the company’s NPLs. The same occurred in the case of a community council which had NPLs and the CCB took funds from the employees’ pension fund.

Among those affected are CCB former employees and others who had put some money aside in order for the children’s studies.

Ioannou said that offsetting is permitted when this is covered by the loan agreement with some 5500 such cases considered legal.