ECONOMY

Bank of Cyprus plans Ukraine acquisition

NICOSIA – Bank of Cyprus expects to buy a bank in Ukraine in the next three months as part of its expansion drive into Eastern Europe, its deputy chief executive said yesterday. Bank of Cyprus is the Mediterranean island’s largest lender with about 29 percent of the banking market. It also holds 3.7 percent of the Greek market, both in terms of deposits and advances. It opened fully fledged banking operations in Romania and Russia this year and, under a three-year business plan, expects overseas activities to account for about 70 percent of its operations. «We are evaluating four or five Ukrainian banks which have certain key features which are of preliminary interest to us,» Bank of Cyprus Group Deputy Chief Executive Officer Harilaos Stavrakis told Reuters in an interview. «Ukraine is a hugely expanding market. We don’t want to miss the train for too long, so we would want to acquire a small bank to use as a vehicle to enter the market,» Stavrakis said. «We are very confident that within three months we will be able to make an announcement of the acquisition of a Ukrainian bank… obviously this would be subject to the approval of the Central Banks of Cyprus and Ukraine,» he said. Some preliminary contacts had been made, Stavrakis said. Asked what he was looking for, Stavrakis replied, «A bank with a reasonable branch network, ideally more than 20 or 30 outlets at the minimum and a clean track record in the market.» Cyprus has strong business links with Eastern Europe and already has Ukrainian clients on its books. The bank also has a team of people in Ukraine covering the local market, Stavrakis said. «Ukraine is a huge market with a population of close to 50 million and it is still grossly underbanked,» he said. In Romania and Russia, Bank of Cyprus expects to set up at least «10 to 20 branches» within the next three years, he said. In Russia, Stavrakis said the bank would put emphasis on growth in Moscow and St Petersburg.