BoC links provident funds recoupment to lower wages, Etyk says


By Stelios Orphanides

Bank workers’ union Etyk said Bank of Cyprus has offered to help members of provident funds recoup losses suffered in the 2013 banking crisis but only in exchange for introducing a new salary regime.

Cyprus’s largest bank already informed its staff about its intention to introduce a new remuneration scheme which “will pin down” the earnings of the vast majority of its workers and their prospect of getting promoted, saving the bank up to 20 per cent on its payroll, the union said in a statement on its website.

“This proves that the ultimate aim of the bank is to drastically reduce labour costs,” Etyk said, adding that staff had already consented to sacrifices to help the bank survive and recover after the crisis.

“No matter how some people try to play down the sacrifices of the colleagues, they cannot write off the reality,” the union said. “If there had been no crisis, the salaries and benefits of colleagues today would be twice as high, and the bank continues to benefit from this difference and will continue to do so forever”.

Finance Minister Harris Georgiades on Thursday announced a new scheme to recoup members of provident funds for losses suffered in the banking crisis almost five years ago with a further €20m on top of two other schemes announced in 2013 and in July 2017, with a budget of €300m and €168m respectively.

Under the scheme announced in July, provident fund members would be compensated with 75 per cent of their losses with a €100,000 cap. The scheme announced last week by Georgiades provides for a more generous compensation of those who have already retired but exempts current Bank of Cyprus workers.

Provident funds, mainly those of bank workers, held €1.1bn in deposits before the bail-in in March 2013. Having repeatedly defied supervisory advice to avoid risk concentration, they lost €763m.

Bank of Cyprus, which is expected to post a €500m loss this year resulting from increased provisions as roughly half of its loan portfolio is not performing, saw its staff cost fall to €224m, when it posted a €64m profit, from €234m the year before. The bank’s total expenses last year fell to €397m from €408m in 2015.

“What is causing a lot of concern and indignation is the government’s interference in the bank’s labour affairs in an attempt to have the bank –apparently– shoulder the cost of the obligations assumed by the government with the commitments it assumed in 2013 to compensate provident funds,” Etyk said. “Our organisation has made clear that it cannot accept a government commitment being turned into a Bank of Cyprus bargaining chip, stressing that it is unacceptable for the government to interfere in the bank’s labour affairs to cover its own mistakes”.

Bank of Cyprus did not immediately respond to a request for comment.



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

  • Wanderer

    While they are bickering over their unrealistic wages, benefits and whatnot which are unearned but are rather a product of politicians’ pandering to unions to get votes, BoC will quietly go out of business stomped over by the emergence of “fintech” banks such as Revolut, Bunq, Monese and such which serve all of Europe and beyond.

  • Copernicus

    The ETYK members should be facing job cuts or be fired. It is ridiculous that a bank that is over staffed and losing money should have so many staff. The bank management should proceed to reduce its payroll and should freeze hiring. Do bank employees justify their salaries? Why should they enjoy so many privileges. The BoC was bailed in and saved with depositors money not by staff sacrifices. It is time that unions get a reality check that the old banking model is finished and banks need less staff!