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NICOSIA, Cyprus (AP) — RCB Financial institution in Cyprus mentioned Thursday an “extraordinarily unstable geopolitical scenario” has prompted it to wind down operations and switch itself into an asset administration firm.
The announcement got here precisely a month after the beginning of Russia’s invasion of Ukraine. At the moment, the financial institution introduced that Cypriot shareholders had acquired the entire 46.29% stake in its share capital beforehand held by Russia’s VTB Financial institution.
The financial institution on Thursday mentioned in an announcement that regardless of its “ample liquidity,” it’ll instantly cease opening new accounts or giving out new loans following an settlement with the European Central Financial institution.
Auditors Deloitte have been appointed to handle the financial institution’s transition and assist settle all its obligations to depositors. The financial institution will keep on enterprise with present shoppers as common till its transition is full “within the coming months.”
Earlier this week, the financial institution introduced a 556 million-euro ( $611 million) sale of its mortgage belongings to Cyprus’ Hellenic Financial institution. Central Financial institution officers who spoke on situation of anonymity mentioned the sale buttresses the financial institution’s liquidity to “totally cowl” all its obligations to depositors amid considerations over a gentle stream of withdrawals over the previous few weeks.
General deposits previous to the acquisition of VTB’s stake amounted to 1.5 billion euros ($1.65 billion). Some 67% was held by Cypriots, though that share has since dropped to simply below 50%.
Central Financial institution officers mentioned deposits affected by sanctions in opposition to Russia have been “below 50 million euros.”
Nonetheless reeling from a 2013 financials disaster that put the nation on the verge of chapter, Cyprus has been at pains to rehabilitate its picture as a cash laundering haven the place Russian oligarchs may park their money.
The Cypriot authorities has mentioned the affect of Russia’s invasion of Ukraine shall be restricted due to a raft of measures to scale back Cyprus’ publicity to the Russian financial system.
Banking officers who spoke on situation of anonymity mentioned that Russia-linked deposits in Cypriot banks quantity to between 4% and 6%.
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