Hellenic acquires 553 million euros worth of Cypriot corporate loans from RCB

Hellenic Bank has acquired 553 million euros worth of Cypriot business loans from RCB Bank, increasing its loan portfolio to over 7.2 billion euros.

The acquisition concerns 100 corporate loans divided into two parts.  The first transfer will cover 300 million euros worth of loans by Cypriot customers which will "untie" them from Russian loans.  Deposits at RCB will not be transferred except in cases where they may be linked to the loans themselves.

The move comes after RCB's long-term ratings were downgraded by rating agencies Moody's and Standard and Poors, citing the impact from the lack of support by its previous major shareholder, the Russian VTB Bank, as well as potential second-hand effects of Russian economic activity, including deposit run-offs.

On February 24, the day Russia invaded Ukraine, RCB Bank announced a transfer of 46.29% of its shares owned by VTB Bank (PJSC) to Cypriot shareholders, in a possible move to mitigate its exposure to VTB and the sanctions being placed on Russian banks and companies.  The approval for the transfer is still pending.

RCB Bank's total assets at the end of 2020 amounted to €4.9 billion, while its Liquidity Coverage Ratio (LCR) was at 170%, making it the third-largest lender in Cyprus.  Furthermore, the bank had recorded a profit of 11.5 million euros in 2020.

Hellenic Bank's gross lending portfolio in September 2021 amounted to 6,710m euros, compared to 6,802 euros recorded in December of 2020 with a marked decrease of 5% in non-performing loans. 

Hellenic Bank's lending market share on 30 September 2021 was 22.4% (31 December 2020: 21.5%). The ratio of net lending to deposits stood at 41.1% as of September 30, 2021 (December 31, 2020: 43.0%).