By Stelios Orphanides
Co-op bank executives on Thursday expressed satisfaction over investor interest, as the deadline for the expression of interest for acquiring the Cyprus Co-operative Bank, its assets, or part of them, expires on Thursday at 2pm.
“Those who are in, are of high quality and this matters a lot,” said Yiannos Stavrinides, head of communication and strategy at the state-owned bank. “Fortunately, there is interest about all aspects and options of the transaction announced on March 19.”
Some of the investors, he added, have invested in Cyprus in the past or have investment on the island, while others have invested in South Europe, including Greece.
Stavrinides who was speaking on state-radio CyBC, said that the bank will not disclose names of investors who will be deemed eligible to enter the second stage — expected to be completed by the end of May – in line with confidentiality agreements. In the second stage, investors will have to submit binding offers.
The US financial services giant Citi, which advises the bank, bailed out by the government with almost €1.7bn, has been screening interested parties to ensure that they have the financial capacity to carry out the transaction plus the qualitative characteristics required for supervisory approval, the executive said.
“Our preference is the one that will ensure the highest degree of stability,” Stavrinides said in response to a question whether the bank prefers to see an investor acquiring it as a whole or its assets. “This will be ensured via the content of the proposals which is something we don’t have today. Today we only have expression of interest”.
Stavrinides said that the bank, which is struggling with €6.5bn in non-performing loans, accounting for roughly half of its loan portfolio, has been witnessing “some activity” at the branches caused by customer concern about the outcome of the procedure, which was expected.
On Tuesday, Moody’s Investors Service cut the bank’s baseline credit assessment by two notches to ‘ca’.
“This concern cannot block the procedure underway,” he said.