Bank of Cyprus AGM applauds Management

A massive show of force by Bank of Cyprus shareholders gave the Bank’s Management and Board the nod of approval to carry on with their current prudent strategy of organic growth through an independent course, with Chairman of the Board Elftherios Ioannou telling people interested to bid for the Bank to “pay up, or shut up”  when asked by shareholders to explain how Marfin Popular Bank wished to enter into a cooperation and possibly full merger with the Bank of Cyprus.
The Shareholders’ Annual General Meeting (AGM) of the Bank of Cyprus was held on 6 June 2007 in Nicosia. The AGM was attended by 19.262 shareholders, either in person or by proxy, who represented 343.368.550 shares, that is 61,6% of the total share capital.

The AGM discussed and approved the proposal of the Board of Directors for the payment of a final dividend to shareholders of EUR 0,17 per share.

The ex-dividend date is Monday, 11 June 2007. The dividend will be paid to the eligible shareholders on Tuesday, 26 June 2007. The total dividend of Bank of Cyprus for 2006 amounts to EUR 0.29 per share.

The AGM Re-elected the retiring directors Messrs Costas Severis, Theodoros Aristodemou, Evdokimos Xenophontos, Andreas Pittas, Andreas Eliades, Charilaos Stavrakis, Yiannis Kypri and Costas Hadjipapas.

The resolution which was proposed for consideration at the Annual General Meeting by Marfin Popular Bank Public Co Ltd for «instructions and authorisation of the Board of Directors to elaborate and discuss with Marfin Popular Bank Public Co Ltd the terms and sectors for a strategic cooperation between the two banks in order to generate synergies for the benefit of the shareholders of the two banks» was not put forward for voting at the General Meeting, due to the fact that the approximately 8% shareholding in Bank of Cyprus by Marfin Popular Bank is the subject of investigation by the Commission for the Protection of Competition, said BOC Chairman Ioannou.

In any case, irrespective of the above, the proxies received by institutional investors and the wider shareholder base of Bank of Cyprus indicating the rejection of the resolution proposed by Marfin Popular Bank represented a very significant percentage 99,92% of the proxies represented at the Annual General Meeting.

The immediate response by our shareholders constitutes a material proof of their support in the course and strategy of Bank of Cyprus,” said Ioannou.

Following the AGM, the Board of Directors convened a meeting and unanimously re-elected Messrs Eleftherios Ioannou and Andreas Artemis as Chairman and Vice-Chairman, respectively.

Bank of Cyprus reported a 153% increase in net profit to EUR317 mln, compared to EUR 67 mln in 2005, while Return of Equity (ROE) surpassed 20%.

 

Put up, or shut up

The soft-spoken Ioannou sent a powerful message to Marfin Popular to stop hampering the smooth operations of Bank of Cyprus by making “illfated” and “dubious” statements to the media that they wish to force the Bank to enter into a dialogue leading to cooperation or merger.

“Put up, or shut up” is how Ioannou described any person or institution wishing to make bid for the Bank of Cyprus. Ioannou said Marfin strongman Andreas Vgenopoulos has to submit a public offer to the shareholders of Bank of Cyprus if he “really is interested to buy this bank.”

“Our shareholders have today showed their determination not to allow the break-up of this bank and not be drawn into risky adventures that will only hurt their own interests,” said Ioannou, while shareholders backed a call by a shareholder to force Vgenopoulos to “pay EUR 18 per share, plus a 20% takeover premium.”

Referring to the attempt by Bank of Cyprus to acquire the Emporiki Bank of Greece, Ioannou defended the initial interest shown by the Bank and then its unilateral withdrawal stating that “Emporiki is a historic bank that we could not pass, which is why we submitted our bid, but then we withdrew after it became clear that there was a problem with its pension fund liabilities.”

A charge by a shareholder who said the Bank “wasted CYP 5 mln on the bid” was dismissed by Bank of Cyprus CEO, Andreas Eliades who said “we only spent about 1.7 million in consultancy fees and other charges.” Eliades also noted that the Bank pays different consultancy fees and charges for its ongoing operations and Management will not accept shareholder criticism on this topic, at a time when the profits are increasing severalfold, showing and confirming that the Bank is on top of the situation.