2010-2020

• Under resolution

  Signs of the economic crisis begin to emerge from the beginning of the new decade. The sale of Bank of Cyprus Australia Ltd in 2011 marks the end of the growth era. The period of financial pressure drags on until 2014.
  
  The ‘haircut’ of the Greek debt in combination with the domestic political and economic conditions lead the two largest banks of the island to a dead end. In March 2013, faced with the double fiscal and banking crisis, the Eurogroup decided to bail-in deposits and the Bank of Cyprus was under resolution for the period from March 25 until July 30 2013. The Bank's shareholders and depositors bear the cost of the bail-in, while the sale of the Group's loans, deposits and real estate in Greece minimises the systemic risk of transmission of the Greek crisis to the Cypriot financial system.
  
  After the closure of Cyprus Popular Bank Public Co Ltd (Laiki Bank) in March 2013, the secured deposits and the majority of its assets and loans are transferred to Bank of Cyprus. A painful development is the transfer of an amount of €9 bn of Emergency Liquid Assistance (ELA) to the Bank of Cyprus.
  
  Based on the resolution plan, the Bank proceeded to transfer specific assets and liabilities of the branch in Romania, including the majority of its customers' deposits, specific loans and related collateral, to Marfin Bank Romania. This is followed by the sale of the Group’s operations in the Ukraine in 2014, as well as the Bank’s investment in Banca Transilvania. The sale of part of a loan portfolio in the United Kingdom which was transferred to the Group following the acquisition of certain operations of Laiki Bank in March 2013, was another step towards the reduction and improvement of its balance sheet. 

• On the path to recovery

  Integral to the recovery process is the €1 bn increase in the Bank’s share capital in 2014, with the participation of foreign investors in the shareholder structure of the Group. This is the largest single investment in the history of the financial system of Cyprus. In December 2014, the shares are listed on the Cyprus Stock Exchange and the Athens Exchange. In April 2015 all Capital Controls imposed by the regulators in March 2013 were lifted. The sale of Uniastrum Bank in Russia in 2015 is a milestone in the develeraging strategy of the Group through the sale of non-core operations and the shift to core activities and markets. The sale of Kermia Hotels Ltd in 2016 and of CNP Cyprus Insurance Holdings Ltd in 2019 were also part of this strategy. In 2018, the Bank proceed with the sale of its UK subsidiary Bank of Cyprus UK Ltd to Cynergy Capital Ltd, in order to focus its operations in Cyprus.
  
  In January 2017 the spotlight returns to Bank of Cyprus. The full repayment of the ELA in less than four years, against the backdrop of an extremely difficult economic environment, allows international rating agencies to speak of a real “financial achievement". In the same month, the Bank returns to international markets with the issuance of €250 mn Tier 2 capital.
  
  The significant progress made, including the continuous improvement of the quality of the Bank’s balance sheet, seen in the continuous organic reduction of NPEs for eleven - until then- consecutive quarters, allows the successful listing and trading of the shares of Bank of Cyprus Holdings Public Limited Company on the London Stock Exchange on January 19, 2017. The Bank maintained the trading of its shares on the Cyprus Stock Exchange, but not on the Athens Exchange.
  
  The agreement for the sale of a portfolio of €2.7 bn NPEs in mid-2018, known as Project Helix, is a milestone in the Group’s strategy for NPE reduction. Another agreement for the sale of a portfolio of c.€900 mn NPEs was reached in August 2020 (Project Helix 2). In addition, the Bank proceeded with two other smaller sales of NPEs, known as Velocity 1 and Velocity 2, amounting to €30 mn and €133 mn respectively. Overall, since the peak in December 2014, the Bank has reduced the stock of NPEs by 83% or €12.4 bn to €2.6 bn as at 30 June 2020 (pro forma for Helix 2). 

• Regulatory compliance

  "To effectively apply throughout the Group a corporate culture of ethics characterised by high standards of integrity, transparency, confidentiality and regulatory compliance."
  
  This is the mission of the Bank's Compliance Division towards which it continuously strives.  The Compliance Division, in collaboration with a network of 50 experienced Local Compliance Officers, monitors the implementation of actions to mitigate risks arising from the ever-changing regulatory requirements. The Group’s Compliance Policy is aligned with the requirements of the relevant Directive of the Central Bank of Cyprus, as well as with the guidelines issued by the European Banking Authority.
  
  The Bank of Cyprus’ current operating framework in matters of compliance, supported by advanced technological tools and models, is governed by the highest international standards of excellence and fully adheres to all relevant local, European and international legislation including the USA Patriot Act, the UK Corporate Governance Code and EU regulations.
  
  In 2016, the Bank of Cyprus won the Transparency International Award for best practices, initiatives and actions to reduce corruption and/or increase transparency in Cyprus.
  
  To reinforce its commitment to a culture of ethics, the Bank pioneered the establishment of an Ethics, Conduct and Culture Committee in Cyprus, to promote the Board’s collective vision and values, and to encourage management efforts to cultivate such culture.

• Corporate Governance

  The Bank’s listing in the London Stock Exchange in 2017 entailed persistent maintenance of the highest corporate governance standards. The Bank of Cyprus is now regulated by seven separate international competent authorities in four jurisdictions (Cyprus, Ireland, the UK and the EU).
  
  In February 2020, Bank of Cyprus won a very important European distinction! It won the special ‘Banking Governance 2020’ award of the prestigious magazine ‘Ethical Board Room’ for the best banking governance in Europe. This distinction reflects the prudent ‘housekeeping’ policy pursued by the Group, through best practice corporate governance, which enabled it to escape the deadlock of the 2013 crisis.
  
  Previously, and for four consecutive years (2017-2020), the Bank had won the Best Corporate Governance Corporation (Cyprus) Award by World Finance (UK).

• Zero tolerance for financial crime

  Since early 2014, the Bank of Cyprus, faithfully sticking to its course of reform without exception, has implemented a very strict and demanding remediation program for the combating of financial crime which among others included specialised training programs for its staff.

• Continued wins against financial crime

   

  • Reduction of the clientele of international banking operations by 35% since 2014.

  • Termination of approximately 81% of relationships with professional intermediaries introducing clients to the Bank (from 1,601 in 2014 to 302 in 2019).

  • During the period 2015-2019, 10,612 customer relationships were terminated/suspended, solely on compliance/financial crime reasons corresponding to over €6.1 billion of turnover and yearly net profitability of €19.6 million (estimated).

  • Rejection of 5,803 potentially new customer relationships solely on compliance/financial crime reasons