CYPRUS: Fin Min under fire for wanting to reduce bank branches

Finance Minister Harris Georgiades found himself under fire from opposition parties when agreeing Cyprus had too many bank branches.

He made the comments during a House Audit Committee discussion on the closure of some 40 former Co-op branches in rural areas after the Hellenic Bank takeover.

When asked why the government did not take measures to minimise problems arising for communities with no banks Georgiades said: “If it was up to me, I would have closed more branches.”

DIKO MP Zacharias Koulias initially said that the closure of the Co-op was a catastrophic development for the country and that it created enormous problems for the people, especially the rural community.

He accused Georgiades of behaving more like a banker rather than a Minister, and that Hellenic Bank showed greater understanding towards people’s problems than the Government.

AKEL MP, Stefanos Stephanou, said the government once again proved to be socially insensitive.

Responding to criticism from opposition MPs Georgiades told CyBC radio on Friday said that he felt it was about time the truth was spoken.

“If one looks at the number of banking branches we have in Cyprus in correlation to our population and makes the same comparison with the rest of Europe, you will see that despite the decline, we still have a lot of bank branches,” said Georgiades.

He said Estonia – technological leader and invests heavily in digital business – with a larger population than Cyprus has 95 bank branches while the island still has over 400 and pre-crisis there were 1000.

“This translates into unnecessary costs. We must bear in mind that banks are managing depositors' money. If there had to be an intervention, it could have been to encourage investment by banks in technology,” said Georgiades.