USB up on renewed bid talk
Laiki Bank shares maintained their gains above the key CYP 2.63 level, closing Tuesday at a fresh three month high of CYP 2.70 amid bullish expectations that the first half results, due to be announced by the Bank next week on August 8, will show that profit surged by 150% to CYP 45 mln.
The break above the CYP 2.63 is seen as crucial since previous attempts to break above this level had proved futile. The new objective according to Financial Mirror chart analysis is the CYP 2.88 level, followed by CYP 3.07, the previous all-time high.
Some of the selling pressure may have also been due to unconfirmed reports that Kikis Lazarides, the departing Chairman of Laiki, may have sold or disposed a substantial amount of shares immediately after his departure.
Informed sources told the Financial Mirror that there may be no securities law violation for a departing high ranking individual to sell shares from the company he is leaving if there is no financial gain made or if in the meantime the share price has moved higher, which is the case now, but the newly appointed Chairman of the SEC, George Choriambus believes otherwise.
In remarks to the Financial Mirror, Charalambous said even if the departing officials had secured permission from their Board to do so, still, under the provisions of the law, any activity on their shares should have been announced.
Charalambous promised a full-scale investigation into the activities of company insiders trading in their shares during a closed period (ahead of release of results), which he insists will be strictly maintained.
Bullish forecast
Laiki Bank shares nevertheless powered ahead amid bullish expectations that first half profit to be released on August 8 will show a 150% gain to reach CYP 45-48 mln in net profit according to Financial Mirror estimates, compared to CYP 18.2 mln a year ago in the same period.
If the forecast is confirmed, then the Laiki first half profit would be higher than the CYP 42.8 mln in net profit reported for the whole of 2005 and the profit growth, more than the 127% increase recorded for the first quarter when profits reached CYP 20.2 mln vs. CYP 8.9 mln in Q1’05.
USB on the move
In addition to brisk activity on the Laiki shares, which also spread to Hellenic Bank shares as they closed above CYP 1.20 critical resistance, the sharers of Universal Bank (USB) were also active following a report that the Aspis Group is interested to acquire the bank, which is also sought by a Cyprus based German shipping consortium backed by the Hellenic Bank.
USB shares closed 6.5% higher on Tuesday at 82 cent on negligible volume of CYP 19.000 following a report filed in Greece with the ASE that the Aspis Group, together with its related party the Commercial Value has submitted an application with the Central Bank seeking permission to wrest majority control of USB.
On the other hand, the Cyprus based German shipping group, Schoeller and Path Holdings are believed to be seeking 52% control of USB, backed by the Hellenic Bank, according to Philelefteros.
In an official announcement made at the CSE, the Board of Universal Bank said it is not aware of the developments and is finding the news regarding its fate from the Philelefteros reports!
Last March, the Board of Universal Life Insurance Co., holding 60% of the share capital of USB had agreed to sell its stake to Schoeller and Path Holdings, but the negotiations collapsed after the CB decided not to grant such a license.
