THEODOROS Aristodemou, the chairman of the Bank of Cyprus has resigned for health reasons and has been replaced by the bank’s vice chairman Andreas Artemis; Evdokimos Xenophontos has been appointed as the bank’s new vice-chairman.
Aristodemou, the founder and MD of Aristo Developers Limited, said in a letter to the board that “serious health issues” had forced a two-month absence abroad, and it was unclear when he could fully resume his duties.
“I judge that continuing to hold the position of president does not facilitate the smooth and unhindered operation of the group at an especially difficult time,” Aristodemou said.
“As Chairman, I sought honesty, transparency and collegiality in actions and decisions”.
“As the largest private Cypriot shareholder I participated in all efforts to strengthen the capital structure of the bank with very significant economic personal cost”, he added.
“The problems from the global economic and financial crisis are many and various. Especially the problems of Greece added to our weaknesses affected negatively our economy and financial system”.
“I’m really sorry that Cyprus failed to avoid it”, he stressed.
“Many placements, discussions and debates have been made on the causes and responsibilities of the problems of the economy and the banks. I had and still have my views on the reported problems. But I believe that it will contribute positively if from my post I will go in the midst of debates leading to disputes, at a time when understanding and collective decisions and actions are in my opinion very important and necessary”.
“The country needs a strong economy, strong and healthy banking system. I hope Bank of Cyprus to continue to be the mainstay of the economy”, he concluded, expressing his optimistic that this can be achieved despite the difficulties.
Commenting on his sudden resignation, a board member of the bank said “Mr Aristodemou feels he can’t continue in the job after undergoing a serious operation in the US given the present difficult circumstances”.
Aristodemou, the bank’s largest private shareholder, assumed the chairmanship in May 2008 and had been a member of the board since 1991.
His resignation comes only weeks after the departure of the bank’s chief executive, Andreas Eliades, who was forced to stand down after revealing an unexpected €500m capital shortfall according to a report in the Financial Times.
The Board of Directors has also accepted the resignation of Mr Manthos Mavrommatis who was appointed seven years ago.
There have been numerous negative reports in the media in recent times regarding the dubious practices that got the banks in hot water including their ‘unique’ methodology for determining nonperforming loans.
During the past week, the Cypriot media continued to report on problems within the Bank of Cyprus whose executives have responded by refusing to talk to the press.
“The bank’s new administration has assumed a difficult task and it is very unproductive to deal with announcements and commenting on such reports on a daily basis,” it said in a written statement.
A number of the reports are based on leaked documents, a matter currently under investigation by the bank.
Meanwhile Alvarez & Marsal, the independent firm appointed by the island’s Central Bank to investigate why the Bank of Cyprus and the Popular Bank had to seek government support, will also be seeking evidence of possible criminal offences.
@John Swift – That’s a bit harsh on Rats John!
Rats and a sinking ship comes to mind
Having got rid of Sarris from the Laiki bank, the boss of the Bank of Cyprus has also departed. It is known that the government wanted rid of him a few weeks ago, but he refused to go.
No doubt, the government has installed replacements more to their liking.
I found this news item of interest, particularly this section.
“It looks as if there is sufficient trust – in spite of problems. The banks continue to finance the government or to provide new financing packages,” he said.
See full story – Cyprus and Troika could agree on a 1st draft Memorandum
Having borrowed (raided) the semi government organisations for cash, it appears that having replaced the banks heads, they can borrow (raid) their dwindling capital to keep the bloated government machine alive for a few more weeks.
It appears that someone is suffering from a severe bout of Troikitis and has chosen to get away for a few weeks in case it develops into symptoms of full blown responsibility and guilt.
I am tempted to look beyond the obvious to come to the conclusion that there is trouble brewing at Aristo Developers. Aristodemou has pulled out of Bank of Cyprus citing illness, yet is still a director or chairman of a number of other enterprises in Cyprus and has resumed full control of Aristo from Dolphin Properties. The illness story doesn’t stack up and I smell a rat in the relationship between Aristo and Dolphin, probably a falling out about solutions to problems in Aristo. If this is correct what is the position with all the unfinished business that Aristo is embroiled in with owners who have no title deeds. It doesn’t bear thinking about.
I wonder who be next with serious health problems to leave Cyprus maybe a lawyer ?
Developers, Bankers, Lawyers, Government Officials?
Can anyone really tell the difference between them when they all use the same pot, and are all joined at the hip in the Olympic sport of ‘artfullness’?
Living in Canada now right beside “The Excited Snakes” (that’s “the United States” for those of you not used to this nickname we have) watching the high level far more serious chicanery of the US Republicans and general political garbage we witness at its most high level, (including the verbal garbage spewed from the Federal Reserve bank and the banking controlling interests that have successfully changed a pseudo democracy into nothing short of an autocratic Republic just short of a Stalinistic Russian state of control), Cyprus’ clearly far more comic copying of this is LAUGHABLE. I mean, seriously, don’t they even TRY to hide the crooks anymore?
Isn’t there a huge conflict of interest when a major developer was appointed Chairman of a bank, or have I got it wrong?
And today, the very First day of September – likely to be a memorable month for Cyprus? – we see (Cyprus Mail) ‘Popular’ – aka Marfin, Laiki – bank has just announced a further €1.3bn loss ‘mainly on heavy provisions for non-performing loans and an impairment of goodwill’, no real surprises there then.
But Hey, let’s look for Silver Linings, Cyprus Mail today, 1st September, Hellenic Bank, No.3 Lender in Cyprus has returned to profit €14.9m in first 6 months, after a further €78m provisions on the ubiquitous ‘non-performing loans’. I may be wrong but I didn’t hear of any high-level departures from this bank?
Curmudgen – On the face of it there would indeed seem to be a degree of conflicts of interest given that on the one hand one is in charge of organisations that sell a product (homes), supply a mortgage to facilitate that purchase, supply a further mortgage to the seller for the same property, include both mortgages as Bank assets on the balance sheet and fail to make provision for unserviced debt. Using those accounting practices I am certain we could all be multi millionaires many times over in our own lives. The reality of course is a different story as it is for the Banks. Remember these were the institutions that were strong, exempt from the worlds woes as Cyprus is special etc.
I wonder where poor Mr Aristodemou is recovering…the Bahamas perhaps?
If he is ill, then as a fellow human on the planet I wish him well but wonder if he ever considered the misery and illness caused to many by his management of the bank i.e. giving loans and mortgages on land and properties already purchased, or by chasing expats to recover bankrupt developers loans. I bet my last dollar his didn’t and still doesn’t loose a wink of sleep.
If Mr Aristodemou is, as reported, unwell then we must wish him a speedy recovery. One must however ask if he has also relinquished his other directorships assuming he is still a director of Cyprus Airways, CYTA, Aristo, Papantonios Supermarkets etc. If not then readers may be excused for thinking that the second part of Adrian’s comment @ 0714 is not without substance.
One assumes that …”that continuing to hold the position of president does not facilitate the smooth and unhindered operation of the group”… applies to each organisation whether in the capacity of President, Chairman or Director.
I’m reminded of that iconic scene at the end of the film ‘Goodfellas’ when the Mafia bosses are all sitting in the front row at court wearing masks which are connected to oxygen bottles. Theirs was a vain attempt to win sympathy and get lighter sentences.
I also recall the recent case in Cyprus of a leading member of the Drugs Squad suddenly becoming ill and going to hospital after he was charged with allegedly being involved in some malpractice or other.
On a totally different thread, citing “health reasons” for resigning seems to be a common feature for those in the public eye as a reason for relinquishing one’s post (the former Finance Minister being a case in point) and Mr. Aristodemou seems to fit neatly within this genre. I’m sure it’s nothing whatsoever to do with the parlous state of the Bank of Cyprus or the reports in other publications that he himself took out massive loans from the bank. Perish the thought. I trust that all will be revealed in the fullness of time.
As for the leaks emanating from the bank, this will never do. All whistle-blowers must be rooted out so that the bank’s ‘integrity’, confidentially, loan portfolios and working practices can be protected at all costs. Read into that whatever you will.
Two phrases come to mind. Chickens coming home to roost, and rats leaving a sinking ship !!!
This article, read with ‘Investigators to report criminal liability’ Posted: 31 Aug 2012 05:15 AM PDT suggest ‘something is rotten in the state of’ (Hamlet)…….Cyprus banking? Part of this will very likely stem from the ‘unique’ method used by some Cyprus banks to classify ‘non-performing loans’ , aka as bad or potentially bad loans, of which one senses there are many, especially in the property and construction sectors. And asking the Troika recently to ‘understand the nuances’ of bad debt provisioning in Cyprus banks is hardly going to help! The Troikas upcoming Report on Cyprus and Cyprus banking should make very interesting reading!
So! It’s true! What goes around does finally come around. As the founder of Aristo Developers; the Managing Director of Aristo Developers and having recently exchanged most of his Dolphin CI shares to become, once more, the sole owner of Aristo Developers; it could be argued that this man has adversely affected the health of thousands.