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CB waiting for troika’s reply

21/02/2013 13:28
The Central Bank of Cyprus anticipates the troika’s decision whether the banks will be informed on the amount of their capital needs estimated by Pimco.

In her statements to StockWatch, Central Bank spokeswoman, Aliki Stylianou said that CB Governor, Panicos Demetriades sent a letter to the troika right after the Monday meeting with all parties involved.

In the letter, Mr. Dimitriades said this has to be done so that the banks proceed with the preparation of their restructuring plans to restore confidence and stability in the banking system of Cyprus.

According to the preliminary agreement with the troika and the CB for the banking sector, as soon as the amount of recapitalization is granted, as designated in Pimco’s report, the banks will have to submit their restructuring plans each one separately to the Central Bank.

Cyprus Popular Bank, which has been nationalized, must submit its plan by mid March and the rest by mid April.

The banks' restructuring plans will be approved by the CB, the Ministry of Finance, the troika and the Competition Directorate of the European Commission.

During the preparation of the plans, banks will have to take into account, among others, the way in which their capital deficit will be covered and what steps will be taken in the next three years, either with deleveraging or by selling assets or with other measures to absorb the capital needed, preferably from the private sector.

The banks, since they are not aware of the amount estimated by Pimco for their recapitalization needs, asked by the SEC and the Finance Ministry to extend the announcement of their preliminary results for 2012, beyond the regular season, which ends on February 28, since anything included in their results may be misleading to investors.

Concerns on money laundering

According to Mrs. Stylianou, the CB plans to inform the member states of the euro area, which have expressed concerns and doubts about money laundering, how Cyprus is dealing with such issues.

Already, Mrs. Stylianou noted, certain contacts have been made with the Ministry of Finance in the Netherlands and a visit to Germany is also planned.