The list is an eclectic mix of internationally recognisable names from the banking universe, like Swiss former Deutsche Bank chief Josef Ackermann, who was reportedly headhunted last year to take over as CEO of Bank of Cyprus but declined; Swede banker and advisor to World Bank Arne Berggren, and Ross himself.

The business world is also represented such as Russian conglomerate Renova Management’s director of strategic projects Maksim Goldman. In terms of local representation, the bankers on the list are those whose names never came up in any of the discussions about who is to blame for the financial system’s disastrous meltdown last year.

“There are some really powerful names in there,” remarked director of the Cyprus International Institute of Management Theodore Panayiotou. “Names that carry years of banking experience, formidable track records that inspire confidence not just in their ability to face challenges successfully, but also in raising funds, if necessary at some point in the future.”

Panayiotou was mainly referring to Ackermann, poised for board chairman, whose name alone appears to have triggered the Cypriot economist’s implicit trust.

“But not just him – there are others, like (present CEO John Hourican), whom I’ve met personally,” he said. “These are serious people who can be trusted to do the job right.”

In a strange twist of circumstance, Hourican accepted the Bank of Cyprus gig after Ackermann reportedly declined it, and by all accounts has carried it exceptionally thus far.

But even before the names of the new BoC shareholders came out, there were cries against ‘foreign hedge funds’ coming over to gobble up our – traditionally owned and run by Cypriots – banks, strip them of assets to make a quick buck and move along to their next helpless victim.

Archbishop Chrysostomos, particularly, seemed to be on an almost religious witch-hunt to prevent these nameless, faceless “funds” from even getting their foot in the door of Cypriot banks.

“The Archbishop had a point,” Panayiotou said. “These people aren’t here because they necessarily like us, or our banks – they’re here in pursuit of profit. But the distance between entrepreneurial motives to talk of ‘vultures’ is considerable, to say the least.”

Still, Ross’ latest banking endeavour, which was lauded internationally as proof of his trademark keen eye for underperforming money-makers, could become a proverbial arrow in dissenters’ quivers. In 2011, the American investor sunk some €290 million in troubled Bank of Ireland (BoI), which landed him some 9% of the bank’s equity.

Three years and one turned around bank later, Ross made headlines again when he sold all his BoI holdings for nearly triple his initial investment – hardly the stuff long-haul investors are made of.

“One cannot know anyone’s plans with any degree of certainty,” Panayiotou acknowledged. “But Ross appears to be genuinely interested in the long-term prospects of our economy. For one thing, he has talked about Cyprus’ comparative advantages in a manner that suggests copious studying of our economic circumstances and a genuine interest in the broader economy – the tourist industry’s significant growth prospects, and the natural gas finds.”

Panayiotou admitted that investing in a bank only to leave after three years for a huge profit while leaving behind scorched earth – if that were the case – was certainly no badge of honour. “As an investor, you wouldn’t want to have to carry that badge. I’m sure that if one were to take a close look at the Bank of Irelandnow that Ross is out, he would see a healthy, strong company,” he said.

The proposed new board comprises foreigners to locals in a 6-to-4 ratio, which could provide a crucial insight as to the reasons for the demise of one Cypriot bank in March 2013, and the crippling of another.

If international investors wouldn’t trust Cypriots with running a bank, then perhaps Cypriots shouldn’t have, either.

“Obviously, those who put their money in the bank get to make the choices,” Panayiotou said. “But I don’t think nationality was ever the issue in choosing board members. It had more to do with having the skillset, experience and track-record that shows whether one can be entrusted with handling enormous risks.” And does the current – soon to be old – board not have the necessary “skillset, experience and track-record” to do that?

“The current board has done a great job restructuring the bank,” Panayiotou acknowledged. “It did a lot in this regard, and with minimal convulsions. But it has been found wanting in attacking the piling non-performing loans. They should have separated them into viable and non-viable ones, helping out distressed borrowers in the first category and moving to salvage what can be salvaged from the rest. I suspect the new board will do a lot more in this area.”

But for all the errors, distortions and failures noted in the run-up to the sorry state Cyprus finds itself in at present, Panayiotou appears surprisingly optimistic when the discussion turns to the future.

“Today, Cyprus is like Coca-Cola,” he said, in a seemingly nonsensical analogy he was quick to qualify. “On the day the global financial crisis erupted, Coca-Cola’s share price dipped – not because it was a worse company than it had been the day before, but because a lowering tide sinks all boats. Similarly, all the unforgivable mistakes we have made over time notwithstanding, Cyprus is wildly undervalued right now. If you close your eyes and think five or ten years ahead, you won’t find it hard to see the economy rebounding and the country flourishing. “And as with buying Coke shares the day their price dipped, now is the time to bet on Cyprus, and investors looking for opportunities know that,” Panayiotou said.

Source: Cyprus Mail