04/07/2018 17:33
Any fiscal repercussions from state guarantees in Coop deal are absolutely manageable, Finance Minister Harris Georgiades has reiterated, on Wednesday, addressing lawmakers.
Georgiades, who was replying to MPs questions during a parliamentary committee on financial affairs session, further stressed that with the income gained by the Cooperative Cypriot Bank or the organisation which would ensue there would be no impact on public finances.
The organisation, he said “will be absolutely in a position to pay any unexpected losses, most probably, without the second guarantor which is the state, ever to be needed.”
The Cooperative Cypriot Bank would be called on to manage both performing and non-performing loans which would not be transferred to the Hellenic Bank under the provisions of the deal and would have millions of euros in income, he said, adding that the state’s guarantees would only be activated in case the Cooperative Cypriot Bank is not in a position to pay.
“If for whatever reason the organisation is not in position to pay, or there is an extreme eventuality in play, then the state will be liable (to pay),” he noted.
Georgiades further explained that the scheme was different from state guarantees which have been granted in other cases. In such a case, he said, the state guarantees unexpected losses.