Lawmakers’ Bank of Cyprus non-performing loans exceed €35.3m (Update-2)

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(Adds comments by political parties and politicians in the 14th paragraph)

By Stelios Orphanides

The overall amount of lawmakers with non-performing loans at the Bank of Cyprus exceeds €35.3m, a list published by today’s Polities said.

Bank of Cyprus said it prepared the list in order to comply with its obligations towards the central bank in its role as supervisory authority, the lender said today.

“Bank of Cyprus follows to the letter directives of the supervisory authorities and is not in position to take such decisions on its own,” the lender said in an emailed statement today.

The number of overall outstanding amount of the loans of members of the parliament to Cyprus’s largest lender is almost €51.3m, while the total value of collaterals exceeds €47.1m, according to the list.

Central Bank of Cyprus governor Chrystalla Georghadji told lawmakers yesterday at a session of the parliamentary ethics committee that the monetary authority drafted a list of lawmakers with non-performing loans to Bank of Cyprus.

She said the list was put together in the same way United Kingdom does with respect to politically exposed persons.

The chairman of the committee spoke earlier of an attempt by the central bank to blackmail lawmakers via leaks to the press about information of lawmaker debt in arrears.

Stelios Kiliaris, one of the central bank’s executive directors said yesterday he would quit his job citing a rift with governor Georghadji, adding she had told him and other members of the central bank’s board of directors that she had a list with lawmakers who have non-performing loans at Bank of Cyprus.

Georghadji denied Kiliaris’s allegation, including that she had also said law firm Andreas Neocleous & Co. LLC had bribed the deputy attorney general Rikkos Erotokritou.

Bank of Cyprus said that the list was handed over to the central bank, “as Bank of Cyprus ought to do”, adding that the lender was not in position to know more details.

“Personal data management and bank confidentiality are extremely important issues and Bank of Cyprus shares its customers’ disappointment and anger,” the lender said. “”While Bank of Cyprus does not comment on its customers’ accounts, in the case of political leaders included in the list and following communication with them we are in position to say that overall amounts listed as obligations of Averof Neofytou (DISY) and Andros Kyprianou (AKEL), include obligations related to their respective parties. Something similar applies in the case of Nicos Katsourides,” a lawmaker of AKEL.

“We are expressing our deep concern for the inconvenience and uncertainty caused at an institutional level, at a time in which the banking system and the economy in general, following their stabilisation, have entered a recovery course,” Bank of Cyprus said.

Economic recovery should not be jeopardised while supervisory stability has to be maintained “one way or another,” the lender said in its statement.

Several parties and politicians issued statements in reaction to the leak of the list, either denying that their loans are not performing or offering clarifications.

DISY chairman Neofytou said that the Bank of Cyprus press release “clarified completely the issue caused by the leak”.

“When uproar and leaks aim at serving other purposes than transparency, they cause damage to the economy, the financial sector and the country’s credibility,” Neofytou said. “The country wants and the society demands that key people for the country’s financial system and economy act more responsibly and seriously”.

Andros Kyprianou, secretary general of AKEL, said he will take legal actions against all those who included and leaked his name “in lists with non-performing loans”.

“The truth is that I do have loans,” Kyprianou said in statement adding that neither the preparation nor the publication of such a list could prevent AKEL from demanding justice.

“If Hourican or anyone else believes that we could change our political position on foreclosures or other issues with such practices, is completely wrong,” Kyprianou said referring to John Hourican, chief executive officer of Bank of Cyprus.

Hourican came under attack by political parties in early February after comments he made in an internal email leaked to the press in which he criticised the “bemusing politicisation of the insolvency law”. Lawmakers suspended in December the implementation of the foreclosure law citing the government’s delay in submitting a legislative framework on insolvencies, which prompted Cyprus’s international creditors to freeze bailout funds.

Kyprianou added that he instructed an accounting office to prepare a list of his family assets and financial obligations which he will give to the public.

DIKO said that lawmakers of its faction will “immediately” submit to the House president statements with the non-performing loans and financial obligations

“Getting a loan either in the case of a member of the parliament or any other person, is not wrong,” DIKO said in a statement. “What is wrong, is when a deputy’s personal interest determine his voting behaviour,” as well when deputies use their office to get a better treatment from the banking system.

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About Author

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

  • Road Warrior

    Brilliant, the “excrement” has just hit the fan !

    • xenonx

      …….and this is just Bank of Cyprus!

  • Alex

    This would make an interesting dart board.

    • Road Warrior

      Only if you haven’t got an RPG !

  • Vegchef

    Well now we know why the Insolvency laws are being delayed

    • Pc

      Exactly 🙂

  • arandbe

    Say no more…

  • Yvette

    That’s a nice big trough, let’s see all the others now, because I’m sure there’s more, this is just one bank’s worth.

    • Road Warrior

      And let’s not forget, when we look through this list of moral turpitude, these are not people who can’t pay, these are people who, quite simply, won’t pay.

      • Yvette

        But they’re above paying like us mere mortals and some of them are on the recent ‘I’m not paying my tax’ list too. Giovanni the MP Developer seems to get around somewhat.

        • Road Warrior

          Yes, in a country where families are visiting food banks to feed their children, totally disgusting.

      • Skydiver

        How disgusting, and these vaulters are still there, and shamefully they have not the decency to resign,
        Stelios Kiliaris, one of the central bank’s executive directors said yesterday he would quit his job citing a rift with governor Georghadji, adding she had told him and other members of the central bank’s board of directors that she had a list with lawmakers who have non-performing loans at Bank of Cyprus.
        Georghadji denied Kiliaris’s allegation, including that she had also said law firm Andreas Neocleous & Co. LLC had bribed the deputy attorney general Rikkos Erotokritou. that’s another lie…..

  • Mike

    No conflicts of interest there then?

    • Argent

      No, non what so ever, dont forget, these are Cypriots, they are so special.

  • Alexander Reuterswärd

    these politicians have to resign, you can not have lawmakers with debts like this.

    • Pc

      You can have them, but you can then not declare that they will be able to distinguish between the country’s interest and their own interest when it comes to the insolvency and foreclosures law. Especially that AKEL dude at the top looks in severe trouble.

      I wonder what the list from Hellenic looks like?

      • Alexander Reuterswärd

        and COOP…

        • Pc

          Ah yes 🙂 I forgot them 🙂

    • Skydiver

      These are huge sums, some of them owe in the multi millions !!

    • Gandolph

      Resignations would indicate a degree of honour; that’s why this lot will do no such thing.

  • Brian Whiffen

    well that answers why they voted against guarantors being prosecuted,

    • disqus_ZPlOdQqScB

      Sure does!

  • Mike Smith

    Can someone more financial astute explain this. The
    Overall outstanding amount of facilities is much higher for some than the npl’s such as is the case with Sotiris Samp(s)on ( purposefully misspelled?). Does that mean they are servicing the larger part of his loan?

    Also as for the collateral is there really any at all?
    And last but not least why do the patriots not comment on posts like this?

  • costas

    these debtors not small holdings I might add, are not fit to govern

  • GeorgeS

    a lawmaker with an NPL is serious, but there are different levels of ‘seriousness’ to be looked at here, the 2 individuals that owe 27M and 5 million are a story worth reporting on their own .
    the list is a good start, a great start, now we need for the press to push on with these story and we need the press to feed the public in order to put pressure on these delinquents

    • Skydiver

      Also why did Georghadji deny Kiliaris’s allegation ??
      Did the President know about these scams ??
      What is the E U going to do since they wanted to change, the Insolvency laws
      and why did this 2 individuals that owe 27M and 5 million borrow so much money for, and how were they going to pay it back,
      Why did they lie to us saying that they were looking after our interest,with the Insolvency laws, when they were only worried about themselves, I will stop there because I can go on and go on and on…..

  • Argent

    Yet I bet nothing will be done about any of them and the NPLs will remain NPLs.

  • JSReturnsAgain

    When will this house of cards finally topple ? Unfortunately, only when the electorate wake up. Or will we be looking for compensation from the Turks for 74, once again following the straw clutching from our insane hellenic cousins ? Lalaland, what a mess!

    • MountainMan

      I believe that because of the seriousness of this matter, how the Cypriot media are going to town with it, the number of normal Cypriot people, who are paying their debts. out of work, living on the breadline and with children who are either out of work with no future, or out of the country, with a possible future. There are going to be big changes.

      I am looking forward to the next general election, which in my opinion should be called within the next two months.

  • marcus3

    It will be always a paradise for them.Being a politician here, means to get rich quick, and talk empty stories.

    • LMS

      But they’re not rich. They’re absolutely stinking broke. They just live a lifestyle paid for by other peoples money. OUR money. It makes me sick.

      • marcus3

        Agree.Keep ur health.In Cy it s easy to catch serious illness.Unhealthy place in all levels.It s necessary to have horse nerves…who live there

      • Alexander Reuterswärd

        This is something we dont know, accounts in Switzerland, properties etc etc etc,..i would be very interested in a complete check up of these people (the filthy indebted ones).

        • xenonx

          Let’s just start with the other banks in Cyprus first. That information should be as easily available as the BoC NPLs.

  • LMS

    That sure is a list of VERY patriotic Cypriots. Twenty seven million euros from 1 MP and 1 bank! I wonder if he has other NPLs with other banks, too. AKEL’s delaying on this subject has just become a huge and slightly sick joke.

    • Didier Ouzaid

      Man, show some compassion. He might be standing to lose his primary home, which is the only think AKEL are trying to protect. Yeah.

  • Guest

    Why did Georghadji deny Kiliaris’s allegation ??
    Did the President know about these scams ??
    What is the E U going to do since they wanted to change, the Insolvency laws
    and why did this 2 individuals that owe 27M and 5 million borrow so much money for, and how were they going to pay it back,
    Why did they lie to us saying that they were looking after our interest,with the Insolvency laws, I can go on and go on and on…..

    • Didier Ouzaid

      I think Andreas Kyprianou (DISY) sneaked in and impersonated Andreas Kyprianou (AKEL) and dumped his obligations onto AKEL. Crafty. That’s what I would have done.

  • John Henry

    Yet, when the Shyster’s walk in for coffee or meze, every shmuck in the place bows their heads with hopes that a special treat may be afforded them in the future.

  • guest bernard

    Well what a mess….anyone know where we can borrow a miracle?

  • disqus_ZPlOdQqScB

    All should be forced to resign! (in the real world) now it’s proven not fit to hold such positions.

  • Proud To Be Cypriot

    I am disgusted by some of the MP’s on this list, who are not servicing their loans. To balance this information though I would like to know how much each MP lost in the bail-in (as I know that one MP had a 200,000 Euro haircut from one bank account).

    • guest bernard

      Need a fair few more like your example to get anywhere near a balance.

      What appals most of us is that the problem (the MP’s with NPL’s) have been blocking the solution, not as they claimed for the public good, but to save their own grimy necks.

      Shame on them. They clearly have no conscience and no honour.

      How can the problem be given the right to be responsible for the solution.
      and be allowed to veto every effort made by the few honest and patriotic MP’s in their midst.

      They all belong behind bars. There must be some way to bring them to account for such
      unscrupulous behaviour.

      We have seen a mass breaking of ranks and the effluence seeping through the cracks is going to bury ROC unless someone gets to grips with the mess NOW.

      • Frustrated

        Apparently the President is going to spend the week-end sorting it all out. He needs to as he’ll be jetting off somewhere else in the not too distant future….

        • guest bernard

          It just beggars belief. What part of ROC cannot afford these ‘jollies’ does the overpaid idiot not understand.

          With the daily exposures of more and more corruption at the highest level, who does he think actually wants to talk to on the international stage.
          ROC is a joke with a joker at the helm.

          Call an election now and bar anyone with an NPL seeking re-election.

          • peemdubya

            The way ahead – anywhere apart from Cyprus!

      • Proud To Be Cypriot

        The Cyprus Attorney General is independent of the political parties, is appointed for seven years (to outlast any Presidency), and carries absolute power. He can order the arrest of MP’s and even the President (who thankfully is not on this list), and order the suspension of legal proceedings, and has ultimate veto and control over the country. He takes his job very seriously, and has refused to do favours for friends so as to remain untarnished. He will be analysing this situation right now, and will hopefully act soon in the public interest.

        • guest bernard

          Well PTBC, my heart goes out to the people of Cyprus struggling for normality at this awful time. I just hope the AG is strong enough and determined enough to do something. This situation is intolerable on so many levels.

        • Cydee

          You’re right, our AG is thoroughly professional and will deal with it as such. Can the AG call for the dissolution of parliament – and thus force an election?

          • Proud To Be Cypriot

            I am not sure if he can dissolve a government, but he can order the arrest of the entire house if he thinks it is needed.

          • peemdubya

            Wouldn’t that equate to a dissolution, then?

          • Proud To Be Cypriot

            Technically no.

          • peemdubya

            But that would be the product….

    • MountainMan

      I fail to see the relevance of how much the “lawmakers” lost in the bail-in. A lot of ordinary people lost, but are still honouring their debts.

      • Proud To Be Cypriot

        If an MP has debts of 400,000 then he definitely owes that money, and always will. However, if he had deposits of 500,000 and lost 250,000 in the bail-in, then there is a valid reason why he might have trouble in servicing his debt. It is important to get a full picture on how much each MP is trying to cheat the system. (These are example figures only, so I will not reply to anyone who says that 250,000 is still a lot of money.)

  • jobanana

    No wonder they don’t want to remove the obstacles to repossession! This is absolutely disgusting and is a clear indication that most people can actually pay their loans, but simply choose not to!

    • Slomi

      I agree.

      • Rosemarie

        Me too.

    • john john

      and no wonder there is that immunity thing

  • almostbroke

    Makes no difference folks, once the candidate selection process is rigged and fixed by the parties, the rich and elite will all be returned to power and will give “two fingers” to the population while sitting on top of a mountain of corruption, at the same time using the country as their personal ATM machine.

  • FedUp

    Finally exposed as the dirty leeching parasites they are while the rest of us are drip fed their constant BS and these maggots still have the audacity to put on their suits to fart around with our country.

  • guest bernard

    In my more philosophical moods I often wonder what use some things are. Usually I can justify the existence of most beings, each having its place in the food chain.

    However. I have to ask, what use is a mosquito?

    Now I have to ask? What use is our President and what use is two thirds of those who sit with him in parliament?

    You can use a mosquito spray on a mosquito, end of problem.

    . I wonder if I could invent a spray to get rid of all parasites?

  • Alexander Reuterswärd

    The sad part of this is that MPS on this list with low amounts work and earn a very good sallary, and they still have NPL..

    I dont blame unemployed people with no acces to funds, but a NPL of €5000 when they earn atleast a few thousand/month is bad.

    • guest bernard

      I just cannot get my head around their thought processes.
      Hardly rocket science…you borrow, you repay.

      • True cypriot

        I bet you would not have put up with that when you were TOP Banker I? Bernie?!

        • guest bernard

          I was never a top or TOP banker, it was however within my remit to grant mortgages, but only after a credit check, a income check, all existing loans were taken into account and all other financial comitments the applicant had were taken into account. Then, if it was deemed the applicant was comfortably able to service the mortgage, it was granted. By no mean were all applications successful.

          • True cypriot

            Easy peasy!!

          • peemdubya

            No, it is a process to stop errors etc KNOBHEAD!!!

    • True cypriot

      look above – VIVA SPAINIA!!!

  • john john

    the population vote for these scumbags after they make promises and promises they fool the voter to vote for them,they get elected ,they raise taxes and anything else they can raise as a way of showing there gratitude to the people who voted for them and while the whole country struggles with keeping food on the table,these scumbags start there sticky fingering…all they think of 24/7 is money..how to get as much as possible….
    tell me one name of any of these scumbags that are not multi millionaires…

  • True cypriot

    this story was written for most of the anti Cypriot commentators (GB Ex Banker AKA Crocodile Dandy and Alex Reu full time resident of Spain). Look at the list closely, AKEL opposes the legislation ok it is the opposition. DIKO does do and they are the votes that hold the legislation up. You will disappointed to note that only one (1) DIKO MP

    • FedUp

      Tell it to the 600 starving families in Lca and stop embarrassing yourself with irrelevant gibberish,all of them have compromised themselves by betraying our trust and dignity.

    • guest bernard

      Strange, you think that. The truth being that the people you mention are more pro Cyprus than any of the politicians and the ‘my country right or wrong’ brigade. Because they see the problem and are trying to get it faced and dealt with. Those who are happy to let it continue and never ever complain are the real enemies of the ROC.

      Your argument about the size of the NPL is further evidence that they are arrogant and think they can just ignore the debt. The size is irrelevant, the arrogance endemic.

      • True cypriot

        So you are pro Cyprus are you?

        • guest bernard

          Yes

          • True cypriot

            bs

          • bambos

            TC – yes, the legislation is not getting through because the MPs have a very personal interest in ensuring it does not. You must be utterly naive to believe or suggest otherwise.
            1) The majority of NPLs (by number or value) in this list are AKEL, and AKEL is staunchly against the foreclosure bill. Coincidence? The fact that they are currently in opposition has no relevance. They can handily oppose the foreclosure legislation while posing as protectors of the common folk, but of course in reality protecting themselves. (Not to mention the beautiful irony of a single “communist” borrower being granted 28m in loans by an evil capitalist bank – you gotta love that).

            2) Keep in mind that this list is only Bank of Cyprus. I would love to see similar lists from Hellenic, but most especially the coops, that would certainly make delicious reading. BoC at least has some vague notions of proper credit risk management, whereas the coops…nothing but name-lending, and which coop could possibly say “no” to an MP. Ah, I would love to see the MP NPL list at the aggregated coops….

            3) Cypriot banks have always been notorious for their extremely poor willingness / ability to properly aggregate risk exposures. For example, they are extremely bad at aggregating all loans to a related group of parties (e.g. a husband and wife) and listing such exposures as to one risk group, as any proper bank in a properly regulated banking market is supposed to do. So no doubt many MPs, DIKO and otherwise, should show up on this list due to loans, now non-performing, made to their wives/husbands, children, etc.

            4) Same as above for companies. Companies owned by an MP, or their wives, or their children, etc., should also be aggregated to the MP, but I highly doubt this has been done properly.
            5) The list of NPLs of the big developers (aristo, leptos, etc.) dwarfs this list in terms of amounts, and are you suggesting for a moment that the politicians of DIKO et al., are not in the pockets of these developers? That would be rather naive. So yes, protecting themselves directly and protecting themselves by protecting the hand that feeds them.
            No matter how you look at it, this list is shocking. These clowns are supposed to be setting a good example, i.e. one must repay one’s debts.

          • True cypriot

            Great that is what I call coming up with a reasoned argument rather than the usual drivel on this panel.
            I do not disagree with most of what you say I have no doubt some very bad risk assessments were made (yet again if you look at the USA and the UK Cypriot bankers are not alone) and the whole investment strategy of putting all your eggs in one basket was plainly wrong.
            I am trying to point out to people going on about how stupid, backward and crooked the whole thing is that they need to look at it a little bit deeper. If the whole system malfunctioned so badly I am sure we would never have had the recent convictions, lists of non tax payers and loan arrears etc. Nor I think the actual hair cut would have gone through as I am aware of some exceedingly well off and influential Cypriots who endured the whole hair cut.
            AKEL does not feature here, I just can not see them agreeing with anything the government does much like all opposition parties through out the world.
            The votes that matter are those of DIKO which according to the list are not so indebted (I appreciate the possibility of disguised loans) and I have to say some of the points against the pending insolvency legislation are valid and relevant to the person in the street.

          • guest bernard

            Tc. It seems if I say black is black, you will disagree so rather than waste my time repeating the obvious, I will be the magnanimous one and leave you in your self imposed ignorance.

            Blinkers can be dangerous, you cannot see the car approaching from the right or the left.

            Glad you read my comments. I am aware a lot of people read my comments and indeed I return the compliment and agree with the majority of commenters on here.

            Seems you and I are destined to agree to disagree.

            Isn’t democracy wonderful. At least you are not demanding I stop commenting.

          • True cypriot

            you still have not come up with a credible answer

    • john john

      anti cypriot?are you nuts?we are talking about your cypriot politicians and the so called high class……even the normal cypriot folk despise them…..
      the anti cypriot commentators as you say we are…have real pity on the normal cypriots who are having a hrd time putting food on the table in the year 2015 when life is supposed to be much better than it is!!! and all thanks to the lovely politicians and high clas that couldnt give a toss about there own people!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

      • True cypriot

        ah we are so grateful!

        • guest bernard

          Don’t worry Tc, we know you don’t do grateful. Just smug.

    • Disgraced Gothamboy

      I sincerely hope you are not a ‘true Cypriot’, if you are the country has no hope. The idea that the whores of Cyprus politics DIKO are somehow the saints is somewhat ignorant of the power of the prince and his friends (who probably owe millions). imagine, with all that money he isn’t a guarantor on any loans. He’s smarter than I thought, in a very cold and selfish way.

  • marcus3

    No ideas about the future, plans, programs, completely disorganized society.The state does not care for its ordinary citizens,unprepared for messy situations,after 40 years one and the same theme.Third world country full of demagogy.One island without future.

  • Gandolph

    Please, can we stop all the spin and call them what they are? UNPAID DEBTS !!

    • FedUp

      Sure just as soon as their unpaid debt is treated the same as the 600 starving families unpaid debt…fair’s fair, right!!

    • guest bernard

      What is the difference, a long term unpaid debt, regardless of its size is a non performing loan. It becomes a performing loan if and when payments resume.

  • Venturi

    Well, the journalists are being hasty as it seems. The Bank of Cyprus spokesman announced not long ago that these are not NPLs.

    Now who is wiling to give me an explanation what those numbers mean because the BoC spokesman didn’t do a great job explaining either. Start making your own words if it helps, you won’t be the first.

  • Michael

    So, not only they are protecting their mates (and “brown envelope” providers) the major developers (google “BoC furious over debtors’ list leak” for that list), they are also protecting themselves directly by blocking the foreclosures law. They a willing to destroy the country’s economy just to protect their own petty interests. How patriotic of them!

    • scruffy

      Petty interests? 53m between them. Gangsters we are dealing with here.

      • Michael

        You have a point. I meant it is petty in comparison to the billions that the country is losing in investments, deposits etc. as a result of their sabotage of the foreclosures law.

  • Mike Smith

    Does ‘Overall outstanding amount of facilities’mean total loans with the bank?

  • Brettblade

    I would be curious to know if any of the money from these loans, which are not being repaid, is busy elsewhere earning interest until such time as they are written off. It’s surprising how much a few million can earn if invested in a good portfolio.

    • Disgraced Gothamboy

      They didn’t even have to put it into a portfolio, if you could get a ‘preferential’ loan based on the Eurobank rates you could put it straight back into a domestic deposit account and get an instant 3-5% return on borrowed money.

  • Mist

    The coop list and the one for displaced persons/sons and daughters low interest loans for building a house, granted by the government would be interesting. Many of the rich are refugees, and how many have tapped in to this, albeit they don’t need the money but the government do.