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Bank of Cyprus posts 1.94 bil. euro 9-month loss

NICOSIA--The Bank of Cyprus (BoC) announced Wednesday a nine-month net loss of 1.94 billion euros (US$2.66 billion), mostly on the back of provisions for winding up its Greek operations and bad loans.

The shortfall for the recession-hit Mediterranean island's largest lender compared with 211 million euros in after tax losses in the year-earlier period.

The bank said disposal of its Greek operations resulted in a loss of 1.45 billion euros in the first three months of 2013.

Profit before provisions, impairments and restructuring costs reached 224 million euros for the third quarter and 438 million euros for the nine months.

In March, Cyprus clinched a 10-billion-euro rescue package from the European Commission, European Central Bank and International Monetary Fund to bail out its troubled economy and oversized banking system.

The deal included the closure of the island's second-largest bank, Laiki, and a 47.5-percent “haircut” on deposits above 100,000 euros at the Bank of Cyprus.

The bank has since undergone a major restructuring, which included absorbing the good assets of the former Laiki Bank.

The number of its branches has been reduced to 133 from 203, and another six are scheduled to close in 2014.

The bank said its deposit base was “showing signs of stabilization” in the past couple of months.

BoC said that, under a new definition, loans in arrears of more than 90 days accounted for 48 percent of gross loans at the end of September, compared with 36 percent in June, and that provision for bad debts was 697 million euros.

BoC said it suffered not only from disposing of its Greek operations, but also absorbing Laiki's operations in Cyprus and Britain and discarding its retail business in Romania.

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