Hellenic’s Matsis says too much bank regulation puts off investors

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By Stelios Orphanides

Ioannis Matsis, Hellenic Bank’s new top executive, said that excessive regulatory requirements for European banks discourage the consolidation of the Cypriot banking sector, the Cyprus News Agency (CNA) reported.

The acquisition of a locally regulated bank by a competitor regulated by the European Central Bank’s (ECB) Single Supervisory Mechanism (SSM) implies additional cost to turn the bought-out bank into a systemic institution supervised by the Frankfurt based body, he said according to the CNA. Matsis was addressing an audience at an event on Tuesday.

Hellenic Bank together with Bank of Cyprus, Cooperative Central Bank and RCB Bank, is jointly supervised by the Central Bank of Cyprus and the SSM since late 2014.

Banking regulation is very punitive and disproportional subjecting lesser euro area banks to the same regulatory requirements as major banks in the single currency bloc, Matsis, whose appointment as Hellenic’s chief executive officer received the ECB’s approval a week ago, said. Constantly changing regulation, he continued, also deters investment as it makes proper forecasting more difficult.

“Regulation has many different faces, some of them are good, we need to be disciplined, self-regulation works to a certain extent and as the crisis proved we needed more of it, but at the same time we have the pitfalls that come with the regulation” he was quoted as saying.

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About Author

Stelios Orphanides is a journalist at CyprusBusinessMail.com. To contact Stelios Orphanides: [email protected]

  • Disenchanted

    Yes, regulation puts off those after a quick buck at the expense of the taxpayer.

  • Barry White

    Very good that the foreigner running Helenic has been sent away and we can get back to the “good times”.

    I’ll be in for my NPL and € 1 million will be a good start. OPA !!!!

  • Disgruntled

    I agree with Mr Matsis. The daunting anti money laundering paperwork associated with opening say a building committee account is out of all proportion for a day to day account with a turnover of about €2000 per year.

    • JS Gost

      Strange that I can open accounts in other EU countries with very little issue but here I have to jump through multiple hoops like yourself. Could it be that our historical mismanagement and rule breaking has finally caught up with us ? my debt free profitable business here has not even be able to get a spend limited credit card in 5 years here so I have to use my UK business car with £25,000 limit on it, took 4 days to create the card and 3 weeks to get it to Cyprus!

      • Neroli

        And yet all the banks are advertising in Greek how easy it is to get the car you want!!

      • Disgruntled

        I feel your pain. Maybe you are right, though I feel safer with Hellenic than other banks. I eventually gave my credit card back to them as they insisted on blocking off 3 times the credit limit despite the fact that I have lived here 18 years, am a property owner, have never been overdrawn and have an income 50 times the card limit. My branch manager was not interested, even though I paid off my card account monthly by direct debit. I wrote a letter of appeal to the banks former Chairman but it made no difference. So I cut the card up in front of my manager. Had I been Cypriot with the same credentials, then for sure this would have been a totally different scenario. I wrote to the EU Ombudsman but they said that they could not interfere with the Bank’s policies. Just another example of the poor standards of customer respect here in Cyprus.

        • JS Gost

          The big question in any decision here is – are you Cypriot or Greek ? I am thinking of adopting my mother maiden name, who was Cypriot, to see if I am treated any differently.

  • JS Gost

    Poor deluded fool. Years of corruption, zero control and total loss of confidence by potential overseas investors have led to the dismal place we are today. All because WE are driven by greed and arrogance and WE have chosen to shove our heads where the sun does not shine and blame everyone else as usual. Blaming others is one of our main problems. Maybe Mr Matsis could use his deep knowledge to explain why no reputable international bank has a permanent presence in Cyprus, a situation unique to Cyprus across the developed world ?
    Let the banks fail with the appropriate fallout and then Cyprus might have a chance to rebuild. Iceland did it and look at them now. The big difference is the people in Iceland actually wanted change and were happy to lock up the very same people in their society who we have still left in power.

  • Jack Iacovou

    What an irresponsible statement from the new top exec of Hellenic.

    The heavy handed regulation from EMIR is there as the banks and I include Central Banks in this, have proved that they cannot regulate themselves. Are we all forgetting the global banking crisis in 2008 ???. Are we forgetting what happened in Cyprus in 2013 ???. Banks have proven that left to their own devices and irresponsible management will tend to adopt risky strategies in order to maximise shareholder value and their own bonuses.

    The public has lost a great deal of faith in the banking sector and their senior management. This will take time to build again and this ‘heavy handed’ regulation is needed. This regulation will ensure transparency and assign accountability in all of the banks dealings. It will be costly to implement and to operate and although I appreciate the regulatory burden it has to be implemented. This will be the new cost of doing business and it applies to all. If these measures were in place I am certain that our own banks (Laiki and BOC) would have survived 2013.
    Again, I say what an immature and irresponsible statement from the top executive of a leading Cypriot Bank to make.

    He is allowed to privately think this but publicly he needs to support, encourage and implement these regulations and show no tolerance with anyone connected to the Bank in undermining their effect.

    I would even argue with the headline statement and say that too much regulation actually attracts investors.

    Panayia mou – I am so frustrated. I bank with them for heavens sake !!!