CYPRUS: Finance Minister and new Central Bank Governor on the same page

Minister of Finance Harris Georgiades and new Governor of the Central Bank of Cyprus Constantinos Herodotou (CBC) pledged to set their cooperation on a new footing to further enhance financial stability.

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Georgiades and the previous bank governor Chrystalla Georghadji didn’t always see eye-to-eye and contact between them was sporadic.

Herodotou and Georgiades had their first official meeting Tuesday, with the Finance Minister stating that the meeting was not a mere courtesy call but “a substantive working meeting”, adding that their cooperation will enter into a new chapter.

“We decided that this cooperation will be systematic, will be constant,” Georgiades said.

He added there has been big progress in the economy and the banking sector in recent years “but there is still work to be done and, in this context, we believe that cooperation between the CBC, the government and the Finance Ministry is indispensable”.

Georgiades said the top priority is a more drastic reduction of non-performing loans that remain in the baking system.

Herodotou said cooperation is necessary for safeguarding financial stability.

He also said he is scheduling contacts with the parliamentary parties, adding there will be communications on all levels.

“Communication does not affect the CBC’s independence and only by communication we could secure the continuation of the financial stability we have achieved so far,” Herodotou said.

This is seen as a change of tact from his predecessor Georghadji, who, as governor, was often criticised for being aloof and less visible when the situation often needed a more vocal and accessible figure.