The amount concerns the nine-month time deposits maturing on
Sources last night told the Mail the bank leadership had already made up its mind, with the board meeting today merely set to ratify the decision.
Following a decision by EU finance ministers in
In July the CBC said in a statement released jointly with the finance ministry that 12 per cent of the outstanding balance in depositor funds which were frozen under the bail-in arrangement would be unblocked.
The remaining frozen funds were equally divided and placed in six, nine, and 12-month timed deposits.
It is the nine-month deposits that mature at the end of April. The bank does however retain the right to renew (to not release) the time deposits once more following the maturity date. This is in line with a policy of capital controls geared at protecting the largest Cypriot lender's liquidity – though free market advocates might call this a command-and-control system.
Any unblocked funds are at any rate subject to the general restrictive measures currently applicable in the Cypriot banking system.
Back in January, BoC moved to release around €900m held in the six-month timed deposits. The bank at the time cited indications that its liquidity position was improving.
The bank's leadership is now likewise keen to release the nine-month funds, but it's understood that
Given the uncertainty prevailing in the financial sector overall, the ECB is said to be wary of these deposits taking flight if and once they are released.
That would hurt the bank's liquidity, possibly necessitating a further injection of Emergency Liquidity Assistance (ELA) or, as a measure of last resort, a bond issue.
Following the seizure of uninsured deposits (€100,000 and over) to recapitalise the bank, BoC achieved a core capital adequacy ratio of 10.2 per cent, according to figures for
The loan portfolio, it said, is not related to the group's wholly-owned subsidiary, Bank of Cyprus
"The action is in line with the group's restructuring plan and is part of the strategy of deleveraging through the disposal of non-core operations," BoC said.
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