ECONOMY

Cypriot bank branches in Greece reopen on Tuesday

Branches of Cypriot banks in Greece will open as normal on Tuesday following the agreement between their parent companies, Bank of Cyprus and Cyprus Popular Bank, and their new owner, Piraeus Bank, which was all but sealed by Monday night.

Piraeus is set to become Greece’s second-biggest lender (behind National) after absorbing the branches, assets and portfolios of BoC and CPB in Greece plus the 29 branches of Cyprus’s third-largest bank, Hellenic, according to the agreement reached in Nicosia over the weekend.

Despite temporary problems that the delegation of Piraeus officials faced in their negotiations with the Cypriot lenders, the deal was concluded after the Eurogroup decision for the Cyprus bailout and a formal statement was expected late on Monday or over the course of Tuesday.

The agreement safeguards all deposits at the three Cypriot banks’ Greece-based branches, whose deposits will not be subject to a haircut.

The branches will be recapitalized with 1.5 billion euros before Piraeus absorbs them into its group.

The deal is also pending the formal approval by the Greek and European regulatory authorities.