Vekselberg asked permission to increase BoC stake to over 10%


By Stelios Orphanides

Russian investor Viktor Vekselberg applied for permission to further increase his stake in Bank of Cyprus before the government decided to grant him an honorary citizenship, a document suggests.

“Vekselberg is owner of Lamesa Group, present in Cyprus since 2006 and made a significant investment in Bank of Cyprus in 2014, raising the percentage of his shares to 9.88 per cent,” the interior ministry document drafted almost a year ago and obtained by the Cyprus Business Mail said. “This investment occurred at a particularly difficult time for the economy of Cyprus, when foreign investment was the only road to recovery, when investors could hardly show confidence in the Cypriot economy.

“As a sign of his further commitment to Bank of Cyprus and his commitment to the economy of Cyprus, Vekselberg manifested his interest to further increase the (participating) equity of Lamesa Group in Bank of Cyprus, a request which is under consideration by competent authorities,” it added.

According to the website of the Cyprus Stock Exchange (CSE), the shareholding of Lamesa Investment Ltd in Cyprus’ largest lender on June 23 last year was 9.27 per cent, 51 basis points below the figure mentioned in the document.

Interior minister at the time Socratis Hassikos was in favour of the proposal to naturalise Vekselberg, believed to be close to Russia’s President Vladimir Putin, citing his “highest-level services to the Republic of Cyprus, taking into account the so important investment in Bank of Cyprus and his entire business activity in Cyprus benefiting the economy,” according to the document.

According to his spokesman, the Russian billionaire, worth $14.9bn (€12.1bn) according to Forbes Magazine, appears to have declined the honour.

“Vekselberg has only one citizenship,” the spokesman said, which is that of the Russian Federation and added that the investor “was never granted any other citizenship including Cypriot”.

Lamesa’s investment in Bank of Cyprus occurred in August 2014, less than a year-and-a-half after the culmination of the fiscal and banking crisis in Cyprus. The bank which had in March 2013 resorted to converting almost half of its customers’ uninsured deposits into equity sought an additional €1bn in fresh equity to comply with capital requirements ahead of the Europe-wide bank stress tests.

The bank’s success in attracting new equity amid a large degree of uncertainty about the future of the country’s economy which was in its third consecutive year of recession, was described by its chief executive officer John Hourican and Finance Minister Harris Georgiades as the largest ever foreign investment in Cyprus. The capital increase also attracted a group of American investors led by Wilbur Ross, who US President Donald Trump appointed last year as Secretary of Commerce.

Vekselberg’s investment in the bank, which is struggling with an €8.8bn mount of non-performing loans accounting for 46.9 per cent of the total, has not paid off. Bank of Cyprus’ share, meanwhile listed on the London, is traded at around €2.35 which after the January reverse split accounts for a 50 per cent loss of the initial investment.

The Cyprus Business Mail understands that Vekselberg’s request to further increase his stake to a “qualifying holding” of more than 10 per cent of shares or voting rights, is still under consideration by the bank supervisors.

Bank of Cyprus is supervised jointly by the Central Bank of Cyprus and the European Central Bank’s (ECB) Single Supervisory Mechanism (SSM).


About Author

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

  • SuzieQ

    His request referred to the “competent authorities”—what, in Cyprus?

    • Barry White

      Tut, Tut, Tut….. Barry is shuffling over on the naughty bench to make space.

      • SuzieQ

        I think I’ve done well up to now—I thought I’d be on the naughty step for my comment on the woman selling her breast milk!

        • Barry White

          Clearly, an incorrigible young woman that needs firm supervision.

    • Terryw45

      You beat me to it!

    • Vova Khavkin

      Nic’s law firm.

  • ROC..

    Well one thing is for sure, he has no investiment in the North, otherwise it would be money down the drain

    • Neroli

      It will become down the drain here too

    • AnalogMind

      No one invests in occupied areas other than the occupier.

      • ROC

        All mafia, lets not forget who subsidies the North to the tune of 500million

      • ROC

        Occupier being the Turkey to the tune of 500miliion, nothing is owed in the North its occupied the legitimate owners are the ROC

  • Neroli

    Let him buy all the shares in BoC then he will definitely sort out the NPLs!!

  • costaskarseras

    Reading the comments of some British people now living in Cyprus I can categorically say they are not representative of the majority of the British people. They give the impression that they are taking part in a demonstration organized by the BNP. When British and US capitalists vulture funds come to Cyprus, the same people do not have a bad word to say, but as soon as somebody with Russian connections invests in Cyprus they become furious. During the war the attitude towards Russia was different. In those days Stalin was widely known as Uncle Joe.

    However, people across the world including the British people who have been striving against the neoliberal policies are not surprised by the rotten behavior, not only of the banks but more importantly by the neoliberal system. The policies allow the looting of the national assets of whole nations including gas, electricity, water, and the railways, just to mention some of the family silver. Everything was sold but it was not beneficial for us, each British taxpayers now is saddled with a debt of £54.967 and the National Debt is £1.989trillion. The service is often unsatisfactory and the prices are higher in every case.

    Now homes across the UK are facing water supply problems because of the improvement in the weather which has led to burst water mains. However, leaks are the common feature of corporate greed which encourages neglect but companies pay good dividends and no tax as they are based in tax heavens.

    • Veritas

      “The policies allow the looting of the national assets of whole nations including gas, electricity, water, and the railways, just to mention some”, well add oil as well and you have the situation in Russia from the day Putin took over. He and his friends have looted Russia of its assets on the back of the majority of Russians. Any opposition or a free press is suppressed with very hard and rough methods.
      Neoliberalism today, in its very pure form, isto be found in Russia.

  • Evergreen

    Smelling something…

    • Vova Khavkin

      It’s called money in Nic’s pocket although some say that money doesn’t smell

  • desres

    He has an interesting history: He made his first million selling scrap copper from worn-out cables and his Net worth is now14.4 billion USD (2018). I wished I had stuck to the scrap metal business!

    • Barry White

      A small correction. It was torn out cables rather than worn-out.