Bank of Cyprus tells Piraeus to make proposal

The Board of Directors of Bank of Cyprus, having examined its strategic expansion plans has told Piraeus Bank to submit a detailed and specific proposal after which the two sides may engage in serious discussions. The Board having examined the Bank of Cyprus Group direction as well as strategic issues and noted the following:

The successful execution of Bank of Cyprus’ strategy has resulted in impressive profitability increases during the past two years, delivering excellent returns to shareholders. Bank of Cyprus today enjoys strong profitability and capital base and is in a position to take advantage of:

a) the opportunities afforded by its leading position in the Cyprus banking market,

b) its growing presence in the Greek banking sector, and

c) the growth opportunities offered by Cyprus’ position as an international financial center, in particular for corporates from Eastern Europe,

for the benefit of its shareholders.

In recognition of these prospects two international investment houses have recently included the Bank of Cyprus share in their top investment choices for 2007.

Additionally, the Board of Directors examined the letter of Bank of Piraeus for a meeting between the two banks as well as statements to the media by officers of Bank of Piraeus for cooperation.

Having considered that the said letter does not refer to any particular proposal for cooperation, the Board of Directors unanimously decided that there is no reason for the proposed meeting.

The Board of Directors reiterates its stance that it will duly examine any specific and comprehensive proposal in the interest of its shareholders as a whole as well as its staff, customers and the economy of Cyprus in general.