EU dictated sale of Greek branches of Cypriot banks

The terms for the sale of the Greek branches of Cypriot banks to Piraeus Bank were determined by the European Commission and were particularly favorable for the Cypriot banks, an executive of the Greek lender has said.

Constantinos Loizidis, a member of Piraeus group’s executive committee, told a recent press conference in Nicosia that the sale of the Greek branches was a necessary condition for Cyprus to receive the bailout loans that protected it from defaulting. The eurozone demanded that “the Greek banking networks of Cypriot lenders be isolated so as not to drag with them their parent lenders in Cyprus,” said Loizidis.

He insisted that Piraeus had nothing to do with the conditions that were set as they were negotiated between the Commission and the Central Bank of Cyprus. The price agreed for the branches of Bank of Cyprus, Cyprus Popular Bank and Hellenic in Greece “was far higher than comparable transactions in Greece,” he said, adding that Credit Agricole and Societe Generale had to pay in order to have their subsidiaries in Greece absorbed by Greek lenders.