No bids submitted as Hellenic Bank auctions luxury house in Engomi (Update-1)


(Adds outcome of auction in first paragraph)

By Stelios Orphanides

Hellenic Bank was unsuccessful in its first attempt to auction a foreclosed luxury mansion in Nicosia on Thursday as no bids were submitted, a bank source said.

Bidders were discouraged by the restrictive legal framework on foreclosures, even after its modernisation more than two years ago, which forces banks to offer foreclosed properties at a reserve sale price of 80 per cent of their estimated value, the bank may decide on a second attempt at a lower price in the future, the source said, commenting on condition of anonymity.

Copyright @ Christos Theodorides

The movement against foreclosures, a non-governmental organisation had said hours before that it would mobilise on Thursday to thwart the scheduled auction of the 263-square meter house in Engomi.

“Around 10 supporters” attended the auction in Lakatamia, the source said, adding that half a dozen members of far right party Elam also showed up at the venue.

He also described the case as strategic default for which Hellenic Bank obtained a court order to go ahead with the foreclosure on Wednesday.

Photos show the group’s chairman and lawmaker Christos Christou, and spokesperson Geadis Geadi being present at the event.

Since banks started testing the new foreclosure framework in May last year, success at the auctions was limited, mainly attributed to the reserve sale price clause included in the legislation. Central Bank of Cyprus governor Chrystalla Georghadji said in May that she favoured improvement of the legislation to make it more effective.

“The bank goes ahead with foreclosing the residence because of debts of the family business in which the owner of the house in Engomi is a shareholder together with her siblings and parents,” the Movement against Foreclosures said earlier.

The foreclosed property belongs to a “young family with a child,” it added. “Banks are taking a tougher stance as we predicted. A new era begins in which we shall often see properties auctioned”.

A spokesperson of the movement who vowed to avert the auction, said the decision to foreclose the property was taken after Hellenic Bank’s partners in a non-performing loans management unit allegedly intervened in restructuring negotiations. While the borrowers accepted a restructuring proposal submitted by the bank, APS Debt Recovery rejected the proposal, Evgenia Moyseos, spokesperson of the movement, said in a telephone interview.

“It now comes to light that the primary residence, be it of 50 square meters or even 1,000 square meters, is not protected,” Moyseos said.

While Hellenic did not reveal details of the case as part of its standard policy not to comment on cases of individual customers, a spokesperson said that “it fully applies the legal framework and court rulings and shows particular sensitivity to vulnerable groups but not to non-cooperative customers and strategic defaulters”.

The source at Hellenic said the owners of the house with a swimming pool, situated in a prime location in Engomi and built on a 550-square metre plot with a reserved price of €459,000, remained uncooperative for two years “without returning our calls” and stopped servicing their mortgage more than four years ago.

“They challenged the foreclosure at the court and they lost,” the source said.

The Hellenic Bank source also dismissed allegations made by Moyseos that the bank had backed down from an earlier restructuring proposal adding that the bad loan management unit with APS had no involvement in the case. “The procedure was initiated long before the implementation of the agreement with APS,” he said.

Moyseos said that the bank is foreclosing the property because of other outstanding loans extended to the family business, which again the bank source denied.

“They also owe us money as an enterprise but this foreclosure has nothing to do with that,” he said.

The movement against foreclosures staged a protest in early August outside the headquarters of the Cyprus Cooperative Bank when the latter announced a similar agreement with Spain’s Altamira.

Several politicians from opposition parties attended that protest, including Akel’s presidential candidate Stavros Malas, Costis Efstathiou, a deputy of Edek, Anna Theologou, a member of parliament in the Citizens’ Alliance party and deputy George Perdikis, the leader of the Green party.

Hellenic Bank which struggles with a €2.5bn non-performing loans accounting for 57 per cent of its loan portfolio, said on September 1, that it will increase its provisions for loan impairments in its second quarter results by further €51m to an estimated €1.4bn. Non-performing loans, roughly half of the banks’ loan portfolio, are considered the biggest threat to financial stability in Cyprus. The modernisation of the foreclosure framework was part Cyprus’s bailout terms.



About Author

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

  • Adele

    Can’t pay…Take away… Simple.

    • Jay Bee


      • Adele

        Hi Jay hope you’re well.

        • Eye on Cyprus

          I hope so, too.

        • Jay Bee

          Hi A. Had a brief stay in hospital (UK) but back now and OK.

          Take care my good cyber-friend xx

          • Evergreen

            Sorry to hear and glad you are fine now:)

          • Jay Bee

            Thank you.
            Back home minus a few bits and bobs I (allegedly) don’t need……
            Enjoying the sunshine and break from work. ;0)

          • Evergreen

            Super. Bliss.

      • Evergreen


  • almostbroke

    What ever happened to ‘if you borrow money, you must pay it back’ !

  • cypbychoice

    It,s been the case for far too long, now welcome to the the real world, you get ought for nought

  • Neroli

    They’ve had their chances, they could have downsized, the house belongs to the bank, let this be a warning to others!!

  • Bystander

    Is it planet Earth?

  • MountainMan

    One can have no sympathy whatsoever with these type of people. Their action assisted greatly in the collapse of the financial system in Cyprus, Also as a result of what these people have done, it has been very difficult for genuine people and businesses to obtain mortgages/business loans.

    As far as the action of the so called lawmakers go, especially the one who is standing for President, it goes to show that they do not give a damn about the ordinary people, just friends, family, favours owed not forgetting themselves of course, with election on the horizon.

    The disgust one feels for this organisation and the type of people involved cannot be put into words.

  • Zinonas Demetriou

    Enough is enough. Moving around in Mercedes Cars with cigars living in expensive luxury houses but they cannot pay the Bank. Am I an idiot that i pay my mortgages?
    Lets hope other banks will follow as well

    • MisterSamsung Galaxy

      Agreed but please note it takes two to tango. The banks must also be held accountable. The article doesn’t stipulate many finer details of the case

      • Neroli

        What like, that they lent them money and these people don’t pay it back??

        • MisterSamsung Galaxy

          Does the article say how much this couple was earning when they got the loan ? And please clarify for me why a privateer can loose money lent because the defendant doesn’t have the means to pay, while the money banks lend is recoverable no matter what ?
          I am not justifying living beyond ones means. Just pointing out some issues the article doesn’t mention.

          • Pc

            But two wrongs do not make a right. Sure, the bank probably was negligent when extending the loan, but that does not give these people the right to not pay it back.

            And everyone seems to glance over a very important detail: the courts have spoken and said the bank is right in this case. Who are these people that they can defy court orders?

          • MisterSamsung Galaxy

            Agree Pc hence since both parties are to blame, the remedial action must recognize BOTH parties fault.
            “And everyone seems to glance over a very important detail: the courts have spoken and said the bank is right in this case. Who are these people that they can defy court orders?”
            My friend we live in a country where supreme court decisions implementation is to the discretion of the state officials. Not binding. In plain words “selective justice”
            I have a personal friend who has a Supreme court decision in his favour and the chief of police vetoed the court decisions implementation.
            Diko’s Aggelides was the last politician who tried to make supreme court decisions binding for the state but MP’s rejected it.
            Justice is for everyone my friend. Not just the banks..

          • Pc

            As a principle, whenever court orders are honoured we’re inching closer to being a European, honest state. And this isn’t about banks, this is about borrowers vs lenders. As a depositor and saver I would like to see my money back. And that can only happen when debts are paid.

          • I am not sure where you are coming from. Europe, and in particular Cyprus, is run by criminals. The 17 Eurogroup finance ministers (inc. Cyprus’s own Michael Sarris) who carried out the depositor bail-in in 2013, engaged in a criminal act.

            The Cyprus bank bail-in was not the result of a court order. In fact, the finance ministers of the 17 Eurozone states had no legal authority to impose haircuts on depositors. Share-holders and bond-holders should have lost their investments first, according to existing European law in 2013.

            But since the bond-holders were predominantly German banks, the Eurogroup just ignored European law. The European Union Bank Recovery and Resolution Directive (BRRD), authorising depositor bail-ins, only passed into law on 1 January, 2016, three years after the illegal Cyprus depositor bail-ins.

          • Pc

            BS. The reality is that the Cypriot banks were bankrupt. Cyprus, and Greece, need to thank Europe on their bare knees till the end of time for coming to their aid.

            The law in every EU state specifies a picking order in which investors need to contribute to remaining debts in case of bankruptcy. First that are the shareholders, then the creditors (i.e suppliers), then the bond holders and then the depositors above €100,000 (that amount various per country by the way).

            Up to February 2013, EU member states had instead opted to help out banks under the EU rules that allow state aid. But the bill was getting too high. And also, in the case of Greece, Ireland and Spain, this policy was in contradiction with the treaties around the Euro that specified that no country can offload its debt onto other Euro zone countries. So, first with SNS bank in the Netherlands and shortly after with Cyprus, the Finance ministers instead decided to let the picking order of bankruptcy prevail. In the case of Cyprus that meant bailing in the shareholders and the depositors. Cypriot banks were not, and still aren’t, bond financed. They are equity and depositor financed. And you see this same principle now being applied in Italy.

            There is nothing illegal about applying the law.

          • Veritas

            All of us have a personal responsibility for our decisions in life. So when you take a loan, you have to understand and carefully calculate the financial commitment you enter into with your bank.
            I do agree that the banks have a responsibility, but the final decision always rest with the borrower.

          • MisterSamsung Galaxy

            i agree in principal but we both know that in pre-2008 Cyprus loans where handed out left right and centre. Banks should take their fair share of the loss.
            Iceland is the case study to emulate on how to deal with the banking sector.
            What happened here in 2008, laiki merging with boc, demetriades leaving for london, loutsios 28million e.t.c
            All the above give me justifiable “Trapezophthonia”

          • The bank is auctioning the house to the highest bidder. The bank is most likely to suffer a loss in a public auction, especially in a depressed property market.

          • MisterSamsung Galaxy

            banks should not be immune to losses in transactions.
            Who caused the property market to crash ?
            What happened here in 2008 is a scandal and still nobody in prison.
            You pay for loutsios 28 million not subject to bail in. You pay for orphanides moving 300 million outside Cyprus and then bringing the money back and opening business again in his daughters name.
            You pay the loan discounts of the politicians and their companies.
            You want to pay feel free. Me not. I pay for my mistakes. Not others.

          • westspoon

            Here here!

          • divadi bear

            When bought our first house in Germany we had saved enough money to get a loan. But because we had not saved enough money to pay out-right for our house, we took a loan well over what we needed because the 3 % interest we got for our saved money was much higher than the 1.5 % interest for a loan. Interest on our savings was 3 % because we were saving the same amount monthly from my husband’s salary by Direct Debit.
            You can do such crafty deals with “proper” banks. The banks here are in my opinion NOT proper banks.

          • The bank insisted on insurance which they also took a handsome commission on.

          • Pc

            And you do everything someone else insists on? You have no will of your own?

          • Banks insist on insurance when issuing mortgages. They usually give you no choice to shop around which is illegal. Me ? I never had a mortgage or loan or a credit card.

          • divadi bear

            When you need a loan from the Deutsche Bank in Germany, they demand you only get part of the loan from them. The rest has to come from a bank not associated to the D.B.
            2 banks reduces the risk of not being able to pay back afterwards.

          • Caulkhead

            Loans are only possible because of other people’s prudence. There will be no lending if depositors loose faith yet again in the banks.

          • MisterSamsung Galaxy

            Well said. Havn’t made a deposit since 2009 !!!
            Bank of Cyprus stole 14,000 Euros from my bank account.
            What about Laiki customers who lost almost everything ?
            How long will it take them to trust the banking system again ?

          • peemdubya

            Trawl CM archives and the bones of this story are laid out quite plainly – last year or maybe 2015.

          • MisterSamsung Galaxy

            thank you

      • I buy cigarettes from a shop. I get lung cancer. It’s the shopkeeper’s fault? Banks do not force credit on unwilling consumers.

        • MisterSamsung Galaxy

          So to be conned, it can only happen by force ?
          Not saying this couple was conned and again not justifying people who live beyond their means. I do take offence to some people living beyond their means and being punished for it, and others who do the same, not.
          This is the issue and whoever believes that we are living in a fair and transparent society here in cyprus is delusional OR part of the problem. Peace

          • Evergreen


          • Neroli

            We know we’re not living in a fair and transparent society in Cyprus!!

          • MisterSamsung Galaxy

            And what can we do about it ?

          • Neroli

            We have to start speaking out publicly – rather like the birthday bash on the beach at the Anassa? Luckily we have a decent Paphos mayor, maybe at last this is the start? Any suggestions?

          • MisterSamsung Galaxy

            Our issues go way more back than Anassa turtles.
            1) only nikos Sampson went to prison for the coup.
            2) Only papakostas went to prison for Mari.
            3) Nobody imprisoned for the 2008 banking crisis. Vgenopoulos is dead ? Really ?!?!
            And many more examples .
            Well not voting doesn’t help as even with 35% voter turnout elections are legal.
            Protesting outside parliament or Peo or Sek or political party head office wont work either.
            Godspeed to Mr. Phedonos is all I can say and may god have mercy on us all.

          • MisterSamsung Galaxy

            I know we know. Just others who know we know pretend not.

            1/3 of the Republic of Cyprus is living on the backs of the 2/3.

            Wait for more scandals also regarding eu fund appropriation. Not just Tepak….

          • almostbroke

            A third Sam – I think you are being generous , I would have thought it was a lot less that that!!!!

          • divadi bear

            A lot less than 2/3rds ??

          • peemdubya

            N, come on!! Cyprooos society is transparent – it is plain to see where all the dodgy stuff goes down, normally with MPs / relatives / friends etc etc…!!

      • The law hamstrung them.

  • Theo Dorotheou

    4 years no payment!!!! wow. here in poland the debt collectors are round (with police) to remove the person in a year. there is virtually no renegotiate terms and zero “not first home” rules… everyone borrows within their means and pay there debts on time… and poland has very low non performing loan ratios. i miss cyprus where paying taxes, social security, rent, and loans are not required to be paid.

  • cyprus observer

    Unbelievable……perhaps the young couple with the child should have done some financial planning to see if the really needed or could afford a 263 square meter house?

  • Douglas

    The is what’s happens in the real world,that’s providing you do not live in a fantasy Island 🙂

  • Eye on Cyprus

    Planet Hub??

  • Jay Bee

    I am bonny lass, don’t worry……..x

  • Bob Ellis

    Poor deluded fools…..

    • Eye on Cyprus

      Is that the incompetent bank, the self-serving protestors, those who passed the stupid law to protect primary residences, those who actually honour their debts, those customers and investors who are now covering the banks’ losses . . . or all of them? (A rhetorical question!)

  • GeorgeS

    i dont think anyone can sympathise, if the article is accurate and they stopped paying for the property 4 years ago, then they’ve had 4 years of rent free , luxury accommodation. Not repossessing their house would have been a complete farce and so unfair to people that rain or shine, make their mortgage payments every month

    • Part of thinks it’s backfired for the banks. They don’t want thousands of over valued properties to auction. This might not cover the debt.

  • Cydee

    They’ve been taking the proverbial. No sympathy.

  • Theo Dorotheou

    this is not uk or the us… in cyprus it is really really hard to get a loan of any sort… we had a strict veting process and these people would not have got the loan if they could not pay. it was their choice not to pay.

    • Is that recently with new rules ? I heard multiple times people were cold called at home saying they qualified etc. I assumed perhaps incorrectly that Cyprus had a disproportionate banking and financial services sector. I guessed the vast deposits held here at good rates mean’t credit was easy ? Banks lend what they hold, in this case to a local market.

      • Disenchanted

        Exactly, that’s how it was. All because of the influx of dirty Russian money, laundered by the politicians lawyers and their banker friends. Then the banks had to do something with it, right? So they offered easy credit to developers, backed by the church and some key politicians. Then in order to sell those properties, the banks started offering easy credit to people and we ended up with one of the highest household debt per capita in the EU. The rest as they say is history.

    • chitchat

      are you joking? Before 2013 you could have got a loan of any size just because a bank manager was your cousin or koumbaros… not to mention any other connections such as politics, bribes, etc…

      • Theo Dorotheou

        rubbish… you needed a substantial deposit and securities to back up the loan.

        • Alexander Reuterswärd

          no, they accepted 100% of the value of the property with the property as the security.

  • V_CM

    So, what stopped the owners from selling the house (be it at a large discount), settle with the bank and rent until they start making enough money? On the one hand people complain that it is so tough to get a loan now, on the other they protest when a bank is about to take property from somebody who is not paying for 4 years. Ridiculous.

    • peemdubya

      This family was reported extensively in CM last year (the year before??), and the facts are mind-boggling that the family ignored every offer to reschedule payments etc – they were warned that they were under threat of losing the property if they didn’t agree to pay SOMETHING but the y refused. That is why we are at this position today.

  • costaskarseras

    Poor Cypriots they suffered the loss of their homes and properties after the NATO-Turkish invasion, later became victims of the stock exchange scandal and now are paying heavily because of the neoliberal robbery of the centuries. The Hellenic Bank is struggling with €2.5bn non-performing loans accounting for 57 per cent of its loan portfolio. It was in their hands to be more responsible and frugal when dealing with the life savings of their customers. Instead, they have shown total dereliction of their duty in their pursuit for even higher bonuses for their directors by offering every Tom, Dick, and Harry loans who obviously could not be repaid This criminal attitude was adopted by banksters around the world after they were given the green light by the neoliberal policies. Our very own Mr Averof Neophytou was continuously preaching that the markets know best and demanded an ever “smaller” government and the lifting of any restrictions which were in existence to protect citizens from unscrupulous dealers

    Regardless of what happens to this family or any other family in the same predicament, the Hellenic Bank wants its pound of flesh. No civilized society should copy the US method by being uncaring and repossess people’s homes without previously offering them suitable accommodation and then let these homes became derelict only to be bulldozed.

    • V_CM

      I suspect that rather being caring, which is not their business, banks would stop giving loans to individuals. Would that be better? Ah wait, then the banks would still be accused of being uncaring because they don’t give out loans easily.

      For some reason I feel like being an idiot because when I take a loan, I carefully consider my ability to pay it back under whatever circumstance and understand that my collateral will be taken if I don’t. Then I see that somebody take a loan for a 260 sqm house with a pool and gather a demonstration when bank takes it way due to non-payment.

      Since when an inadequate assessment of your own abilities is an excuse to have things for free?

  • desres

    Let the protesters have their way, then when the bank goes bust they will have won, albeit lost all theirs and honest persons money

  • Mist

    One of the problems will be retribution on the purchaser, we all know how many Cypriots will react if they consider themselves “wronged”, immaterial, if it is the law or not. There would be a series of incidents at the sold property and it will be eventually abandoned or bombed/burnt out.

  • Alexander Reuterswärd

    estimated value is not a real value, stop the noncense and start all auctions with a zeri reserve to get an understanding of the fact that a property has the value of the highest bidder and not what the seller accepts.

    • Pc

      It is not so simple. When you auction something you can get a vastly different outcome depending on the rules of bidding, the order of auctioning off items, the supply and the demand.

      If you go to Christies in London, or most other auction houses, you’ll find that almost all items have a minimum bidding level. This usually happens when there is low expected demand (i.e. only a few serious bidders) and this way the interest of the seller (the owner of the painting, or in the case of the house, the bank). It is in the interest of the bank to secure a minimum amount as the chances of collecting from the mortgagee are virtually zero.

      • Alexander Reuterswärd

        you are correct and I agree, was mainly trying to say that the estimates on property in Cyprus is a lot higher than the market is willing to pay..

        • Pc

          That is partially because of the laws around foreclosure. But if the property fails to sell, the price starts dropping.