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CYPRUS: BoC fully repays €11.4 bln ELA

10 January, 2017

 * Shares to debut on LSE, resume CSE trading from January 19 *

Bank of Cyprus reached another milestone on Thursday (January 5) when it announced it had fully repaid its bailout-imposed debt and was on track to list its new shares on the London Stock Exchange on January 19.

Finance Minister Harris Georgiades promptly congratulated the bank and its management on the full repayment of the EUR 11.4 bln in emergency liquidity assistance (ELA), that mostly resulted from the bailout agreement imposed on Cyprus and the transfer of bankrupt Laiki’s debts.
“I congratulate (CEO) John Hourican and the Bank of Cyprus on the full repayment of ELA. This is a significant development which reaffirms the strengthening of the bank and the restoration of confidence in the banking system of our country”, the Minister said in a statement on Thursday, moments after the bank made its landmark announcement.
ELA peaked at EUR 11.4 bln in April 2013, after the bank absorbed assets of Laiki Bank which went into liquidation, along with EUR 9.4 bln ELA liability. During 2016 and early 2017 the bank repaid EUR 3.8 bln of ELA, set as a primary target by Hourican who was determined to make the bank attractive to international investors.
Last month, the shareholders agreed to set up a holding company in Ireland and transfer all the bank’s shares to the new company, while delisting from the Athens stock market and keeping the LSE as its main trading market. The stock will continue to trde on the Cyprus Stock Exchange and the bank remains a Cypriot entity.
“This is another significant milestone in the Bank’s journey back to strength since 2013, and was achieved through a number of actions including the extensive deleveraging of non-core assets and operations, the equity raise in 2014, the significant increase in customer deposits over the past two years, the repayment and maturity of Cyprus Government bonds and the conversion of assets into ECB eligible collateral,” it said in an announcement.
In a statement, CEO John Hourican said that the full repayment of ELA funding “has been a strategic objective over the past three years and signifies the normalisation of the bank’s funding structure. This should further strengthen stakeholders’ confidence that the bank is becoming a stronger, safer and a more focused institution capable of delivering appropriate shareholder returns over the medium term.”
Existing shares were suspended from trading on the CSE and ATHEX with effect from January 10, while the trading in new shares of Bank of Cyprus Holdings Public Limited Company (BOCH) on the CSE and the LSE is expected to commence on January 19.