The Coops were nationalized when the Cypriot government injected €1.5 billion into sector to cover its capital shortfall, calculated in the adverse scenario of a due diligence exercise, carried out by a US asset management firm, Pimco, as part of the conditions for a €10 billion bailout Cyprus received from its international lenders. As part of bailout conditions, the Coops implement a restructuring plan that will see their number reduced from 193 to 18 by the end of March. President of the CCB Nicolas Hadjiyiannis also said that earlier the CCB will hold a General Meeting to approve new regulations allowing the state to acquire 99% of the Banks shares.

The agreement will allow the granting of €1.5 billion that have been already been disbursed by the financial assistance programme that Cyprus agreed with its international lenders on March 2013. Hadjiyiannis said the granting of the €1.5 billion essentially locks the Coops restructuring plan aiming to reduce the Coops operating throughout the island from 193 to 18 by the end of March. "A recapitlised cooperative sector with its depositors secured, proceeds decidedly to modernize its structure and towards growth," he concluded.

Source: Famagusta Gazette