Bank of Cyprus sells off "extraneous" former Laiki Bank legacy assets

Source: Xinhua| 2019-06-06 04:10:36|Editor: yan
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NICOSIA, June 5 (Xinhua) -- Bank of Cyprus (BoC) has sold off its entire shareholding of 49.9 percent in CNP Cyprus Insurance Holdings Limited to CNP Assurances for 97.5 million euros, a bank statement emailed on Wednesday said.

The stake was acquired by Bank of Cyprus when it absorbed liabilities and assets belonging to the former Popular Bank of Cyprus, known as Laiki, which was wound down and folded into BoC as part of the 2013 bailout of Cyprus and the resolution of the banking system imposed by international lenders.

The BoC statement said CNP Assurances owns 50.1 percent of CNP Cyprus Insurance Holdings Limited.

The sale is subject to regulatory approvals and is expected to be completed in the second half of 2019, with the sale consideration of 97.5 million euros is payable in cash on completion.

The Bank statement said that the transaction will result in an accounting loss of 22 million euros as its investment in CNP was 119 million euros as of March 31, 2019, but the flow of cash into BoC will have a positive impact on both the Group's Tier Core 1 ratio and Total Capital ratio.

"The sale enables the Group to focus on its core assets and is in line with the Group's strategy of delivering value for shareholders. The Group will continue to offer insurance services through its wholly owned insurance subsidiaries," the bank's statement said.

The bank's stake in CNP was considered as "extraneous" in the sense that is not related to the lender's own operations.

Though BoC held 49.9 percent of the company's share it had no control whatsoever and for this reason it decided to sell its share and focus on its own insurance business.