Bank of Cyprus considers split into property bank

* Sells Kyprou Asset Management for €2 mln *

Bank of Cyprus (BOCY) said that it studying the possibility of splitting the bank into a commercial and a real estate bank, but would not risk the mortgaged properties held as security.
This seems to be a turnaround from initial thoughts by the interim management to set up a separate fund that would administer non-essential assets with a view to attracting foreign investors or offloading the assets in Cyprus and abroad to pay down its debt.
The bank said in an announcement that it was given the go-ahead by the Central Bank on Saturday to investigate this prospect.
The move has caused a public uproar and raised the objection of all political parties opposed to any mortgaged properties leaving the bank and exposing customers.
In any case, the plan will need to be approved by the new shareholders with a meeting expected some time in September.
The bank also announced on Monday that it has already sold its Athens-based subsidiary Kyprou Asset Management M.F.M.C to Alpha Trust Mutual Fund Management S.A. The sale, which was completed on Thursday, July 18, will fetch about 2 mln euros and is subject to the approval of the relevant Regulatory Authorities.
The sale falls under the general strategy of the Bank of Cyprus Group interim management for the disposal of non-core assets and operations and is part of the restructuring efforts.