Bank of Cyprus has completed its listing on the London Stock Exchange (LSE), as its chief said that the UK’s Brexit vote had not altered its decision to move its listing from the Athens stock market.
The move follows its repayment earlier this month, almost a year ahead of schedule of emergency funding of €11.4bn in 2013 to prevent its collapse during the eurozone financial crisis.
John Hourican, who became the bank’s chief executive officer (CEO) later that year and formerly headed Royal Bank of Scotland’s (RSB) investment bank, told the Financial Times that the LSE listing was “absolutely a vote of confidence” by Bank of Cyprus in London’s central place in capital markets following last June’s vote for Brexit.
He said that companies had “more clarity” on the UK government’s approach to leaving the European Union (EU) after prime minister Theresa May’s speech this week but the bank had already been “positive” on the UK’s future. Bank of Cyprus has listed on London’s main market via an incorporated holding company in Ireland.
Its headquarters, management and operations will all remain in Cyprus, with both the existing bank and the new holding company to be tax resident in the island. The Bank of Cyprus will also continue to be regulated by the European Central Bank (ECB) and the Central Bank of Cyprus. Although no longer listed in Athens, it is retaining its listing on the Cyprus Stock Exchange.
Hourican, who is in London to meet investors, told the FT that Bank of Cyprus plans to double the size of its £1bn (US$1.22bn) balance sheet in the UK and “modestly” increase its 250-strong workforce. Its total assets are just over €22bn. “We believe a country with 70m people and a large number of businesses has the potential for us to create some positive P&L [profit] for shareholders.”
He added that the bank’s core market in the UK was “Cypriot communities in the urban centres” who have “business needs that tend to get mixed up with personal needs”.
A statement issued by the bank described the LSE listing was “another significant milestone in the execution of the group’s strategy to become a stronger, safer and more focused institution capable of delivering appropriate shareholder returns over the medium term”.
Earlier this month Bank of Cyprus successfully brought a €250m tier two bond to market, in a transaction run by Credit Suisse and HSBC that was heavily oversubscribed by investors.
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