Today: March 22 2019
russian English greek latvian French German Chinese (Simplified) Arabic hebrew

All that you will be interested in knowing about Cyprus on our website
the most informative resource about Cyprus in runet
Will not be easy. But we can handle!

Will not be easy. But we can handle!

Tags: Banks, Interviews, Crisis Resources, Tourism, Economy

Russian-speaking entrepreneurs, directors and financiers working in the fields of international and local businesses, is well-known Anthony Harith, head of the International sector of Hellenic Bank.

He is respected not only for his excellent knowledge of the specifics of banking and fluent in Russian. Antonis always attentively treats each client and before he expresses his opinion or gives professional advice, analyzes the situation from all sides. At the end of 2013, the bank in which Antonis works, independently found investors and carried out the necessary recapitalization without interference from the "troika". For the Cypriots and the Cypriot banking sector, this has become one of the most pleasant news in recent months. We talked with Anthony Harith about the recapitalization of Hellenic Bank, about the Cyprus crisis of 2013 and ways to resolve it, as well as about what Cyprus will be in 2014 and what steps need to be taken to restore the country's economy.

Unprecedented events

- Imagine that you are talking with someone who has not had a chance to witness the crisis in Cyprus. How would you describe him exactly what happened in the country in March and what led to such disastrous consequences, what were the causes and what are the mistakes?

- If a foreigner knew Cyprus as he was in the recent past, then the story of what happened in March, he would probably take it as a joke, so unexpected and unreal it looks from the outside. Indeed, here events occurred, unprecedented for all world practice. For example, confiscation of deposits, the decision was made at the very meeting of the Eurogroup, as well as the subsequent signing of a Memorandum between the Republic of Cyprus and the "troika" of creditors. As is known, the Memorandum provides for the provision of financial assistance in the amount of 10 billion euros, mainly to support the country's banking sector.

Banking system in Cyprus

- It is said that the Cypriot banking system to function correctly, that it was wrongly built. This is true?

- I'll tell you one thing: to 2011 years, banks in Cyprus were profitable. The argument that the size of the banking system is seven times the country's GDP, is absolutely exemplary. There are countries such as the Netherlands, where the banking sector over GDP in 11-13 time, and that's okay. Cyprus has been very reliable and profitable banking system. Suffice it to recall that the three largest banks in due time passed stress tests. By the way, Hellenic Bank alone volunteered to take the test and successfully did it. It was not until May 2012 years.

Confiscation of deposits and bank recapitalization

- Do you think that could be repeated in Europe, for example seizure of deposits in Cyprus?

- I do not think that such a scenario can happen again. In Europe they realized their mistake and if it is repeated, many banks will simply cease to exist. In the case of Cyprus, it is a pure experiment - to close one large bank, "hang" the debt of a troubled bank to the country's second major bank, forcing it to restructure ... Perhaps not yet noticeable, not everyone believes this, but I believe that the Bank of Cyprus will stand and again become one of the most successful banks in Cyprus. The main thing now is to restore the confidence of foreign investors in order to stimulate the inflow of deposits into Cyprus. Let one historical bank in Cyprus no longer exist, let the second bank experience difficulties, but gradually the situation stabilizes. Trust in Cyprus from the world community will be restored, I'm sure. A good example is Hellenic Bank, which managed to recapitalize partially from foreign funds. Thus, 30% of the bank's shares belong to the US investment company, 20% to the Belarusian Wargaming. Another 15% acquired the Cooperative Bank of Cyprus fund.

- Why co-operative banks to buy shares of another bank?

- It is not the bank itself, and its foundation. The Fund Co-operative Bank was 75 million euros, and they had to be somewhere to invest. And the fund's management has concluded that the most profitable to date in Cyprus will be investing in a successful bank.

Rebuilding a country

- In your opinion, what should be done as soon as possible to restore confidence in the banking system and to Cyprus as a whole?

- Of course, Cyprus faces a number of serious problems. For example, unemployment. According to forecasts, 2014 this year will grow to 21%, that is, every fifth in the country will be unemployed. The second problem is a large number of non-performing loans. In large banks they are about 40-45%, it's too much. It is clear that with this level of unemployment many people do not have the means to pay the loan; There is no money, which means that the market does not move. But, as you understand, banks can not simply write off these loans. We need to review the conditions, make some concessions and in any way try to reduce the volume of problem loans.

- Are there any practical ways to reduce this figure in 40-45%

- I can give you a concrete example. Say, if the customer pays on time, he gets a discount. If he delays payment, he is fined. ... Or for every two unpaid installments of the client for the loan, one fee is repaid by the bank. In fact, it is necessary to develop and carefully analyze various schemes for encouraging debtors. It is necessary to involve and experts who will help to find an acceptable solution. However, by and large, first of all, we should solve the issues related to the extraction of natural gas: to seek new partners. We need to work closely on the construction of a terminal for liquefying gas.

- And if the gas terminal will not be enough?

- I just believe the opposite, though not an expert in this field. In our exclusive economic zone 12 areas, and in my opinion, the total amount of gas produced will be enough to a large-scale project as the construction of the terminal, turned out to be economically viable. However, in order to make a profit in this area, you need to spend a lot of preparatory work. In 2014 year just need to move in this direction.


- If you are currently heading the Cypriot state, which would have taken three steps in the first place?

- Firstly, I would do my best to speed up the process of preparation for the extraction and transportation of gas. In addition, I would actively attract foreign investors. We have good relations with Russia and other former Soviet republics. It's no secret that the economy of Cyprus largely depends on tourism. But, for example, the medical tourism sector is still not sufficiently developed. And how many there are unusual ways to attract tourists - to open, for example, a park of crocodiles! There are investors who are ready to invest in such a project. Another interesting move is the construction of a dolphinarium. Why not? We need to create favorable conditions for investment. Very promising can be and sports tourism. Just imagine, at the beginning of the 1990-ies in Cyprus, winter came to train up to 40-ka sports teams from Russia.

- And then what happened? They realized that it is expensive?

- Not only that. They just saw that we have a well-developed infrastructure for sport tourism (quality stadiums, for example). We need to create a sports village following the example of other countries.

- And how do you feel about the idea of ​​a casino in Cyprus?

- I support this idea and supports the construction of a resort-style casinos, which will provide customers with a wide range of services. It is well known that a large number of foreigners visiting Cyprus with a view to play a few days at the casino in the occupied part of the island. Because there they are given the opportunity! Why not make these tourists were to play in our territory? In addition, I support the construction of marinas in all regions, not only in Limassol.

- In your opinion, as the transfer of the seaports to private hands will affect the efficiency of the port sector in Cyprus?

- Of course, the efficiency will increase. We also need to consider making the ports, not only trade, but also tourism. For example, you can attract various foreign companies, which will make our ports of cruises like the Mediterranean and beyond.

Projections for the year 2014

- At the end of the conversation I would like to hear your forecast for the coming year. What happens 2014 year?

- Obviously, 2014 year will be even more difficult 2013-th. Unemployment. The crisis in the construction industry. Non-simple recovery of the banking system. Do not expect that Cyprus will soon again be what it was before March 2013 years.

The only positive thing: now there is a price correction. I believe that, for example, the price of the Cyprus real estate before the March events were too high. Now acquire real estate on the island would be much easier to both foreigners and residents of Cyprus. Finally once again stress the need to make every effort to attract foreign investors in various spheres and on the development of the gas sector.

Certainly, the country has good prospects. They have not disappeared. Just change the terms that will be required for the implementation of these prospects. Abroad we are not yet fully understand what is the real situation in Cyprus and how much it has improved compared to March 2013 years. Therefore, in the coming months 12 efforts should be made at all levels in order to face all the difficulties that I have just described.

History shows that people of Cyprus do not just have a critical situation. 40 years ago, we were able to rebuild the country and to create one of the leading financial centers. We now manage. Only need to understand that it takes a lot of time and patience.

G|translate Your license is inactive or expired, please subscribe again!