Monday 19 August 2019

Dublin gets Cypriot bank onto the FTSE

John Hourican
John Hourican
Donal O'Donovan

Donal O'Donovan

CYPRUS' biggest bank is to be controlled through an Irish holding company after shareholders yesterday backed a plan aimed at securing a premium London Stock Exchange listing.

The plan is the culmination of a rescue deal for Bank of Cyprus implemented after the lender came close to collapse three years ago, when a so-called bail-in saw savers as well as bondholders and shareholders hit with losses during the Cypriot bail-out crisis.

The bank is now headed by Irishman John Hourican, a former top banker at RBS. Its directors include Wilbur Ross, the US billionaire who bought and sold shares in Bank of Ireland after the Crash and is now Donald Trump's pick for Commerce Secretary, a senior role in the US cabinet.

Bank of Cyprus chairman Josef Ackermann is the former head of Deutsche Bank.

Bank of Cyprus has sold off units and raised €1bn from new investors since its bail-in, including from Mr Ross.

It wants to shift its primary stock market listing to London in order to have easier access to capital in future, but companies based in Cyprus are not eligible for inclusion in the FTSE UK indices.

Irish companies, however, are eligible for inclusion and BOC Holdings was registered here on July 11 this year with an address at the offices of Dublin law firm Arthur Cox.

Filings with the Companies Office show the directors of Bank of Cyprus were appointed directors of BOC Holdings in Dublin between July and the first week in October this year.

The bank will remain tax resident in Cyprus, despite the Irish incorporation.

Papers filed in Dublin show that bank of Cyprus now hopes to have court approval in Cyprus for its balance sheet restructuring on December 21, clearing the way for a London listing in the New Year and no later than March 31.

Under a plan voted through by Bank of Cyprus shareholders yesterday, the bank's current share capital will be reduced to nil, creating a capital reserve in the accounts that in turn will be used to create shares to be issued to Ireland-registered BOC Holdings.

BOC Holdings will become the new parent of, and will issue new shares to existing shareholders, the Bank, in a proportion of 20 to one.

Those moves won't change the ownership of the bank, with investors continuing to hold stock in the same proportion, but will clear the way for the Cypriot lender to list shares in London and join the FTSE index.

Irish Independent

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