Dividend reinvestment on freeze

All investors who have signed contracts with the likes of Bank of Cyprus to have their dividends reinvested into shares at a prearranged discount (10% in the case of BOC) will not be able to do so because of the inability of the CSE to process such deals.

The CSE has said that with the launch of the Common Trading Platform with ATHEX, it will impose a minimum three-month freeze on all such requests because of technical issues without any guarantee that the freeze will not be extended.

Many analysts worry that if BOC does in fact decide to declare an interim dividend for 2006 when the board meets on November 3, then it will create tremendous problems both for the CSE and investors who will want to take advantage of the scheme and reinvest the dividend at a discount.

Others worry that the BOC board may well ditch any plans they may have to declare an interim, lest they create more problems for the CSE.