ECONOMY

Bank of Cyprus posts 1-billion-euro loss

Bank of Cyprus Pcl, the country?s biggest lender, said on Tuesday it posted a loss of 1.01 billion euros in 2011 after writing down holdings of Greek government bonds.

The net loss compared with a profit of 306 million euros in 2010, the Nicosia-based lender said in a statement.

Bank of Cyprus said it reduced the book value of its Greek government bonds by 60 percent of their nominal value, leading to a write-down of 1.35 billion euros, including hedging costs up to the date of the markdown.

Excluding the Greek bond write-down, profit rose 2 percent to 312 million euros, while it gained 8 percent to 331 million euros after stripping out a special tax on banks in Cyprus in 2011, the company said.

Bank of Cyprus added it expects to complete a capital-strengthening plan in March that will boost its pro-forma core Tier 1 capital ratio, a measure of financial strength, to 9.1 percent.

[Bloomberg]