Friday, October 11 17:13:31
Bank of Cyprus, the Cypriot lender which confiscated deposits to recapitalise itself earlier this year, plunged to a 2.3 billion-euro net loss in 2012 as a crippling recession hit people's ability to repay their debts.
The result was worse than the 1.35 billion-euro loss the bank took in 2011, when it was hit by a restructuring of Greek government debt.
Bank of Cyprus made its large depositors its shareholders when it seized their savings in a tumultuous bailout deal with international lenders. Wealthy Russians are now represented on its board.
It also took over some of the assets of the now-defunct Laiki Bank as part of a 10 billion-euro rescue package for Cyprus from the International Monetary Fund and the European Union, and was forced to sell its Greek operations.
Last year's losses, announced on Friday following several months' delay, showed the bank recording a 2.3 billion-euro provision for a worsening loan portfolio and declining collateral values.
The ratio of non-performing loans to gross loans of the group reached 23.7 percent, compared with 10.2 percent at the end of 2011.
Provisions for loan impairment were increased by 441 percent, the bank said, adding that also reflected new guidelines on tracking loans by the central bank.
The figures showed the bank had a capital shortfall from late last year - it had equity of 258 million euros as of Dec. 31 2012, representing a Core Tier 1 capital ratio of -1.9 percent. The requisite is 8.7 percent, rising to 9 percent at the end of this year as stipulated by the country's bailout.