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26 September, 2023
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New plan to safeguard vulnerable groups' homes nears approval

President's meeting with Cyprus Banks Association highlights efforts to strengthen banking system and support economic growth

Newsroom / CNA

The Director of the Press Office of the President of the Republic, Victor Papadopoulos, announced that a new plan to safeguard the first homes of vulnerable groups in Cyprus is on the horizon. Speaking after a meeting between President Nicos Christodoulides, a delegation from the Cyprus Banks Association, Finance Minister Makis Keravnos, and other presidential associates, Papadopoulos revealed that the plan would be approved by the Council of Ministers in the coming days.

During the meeting, Papadopoulos emphasized the importance of a robust and reliable banking system that would contribute to the country's development, economic growth, and attraction of investments. He commended the banks for responding positively to the Finance Minister's call to absorb a portion of the increased lending rates for consistent borrowers and to raise deposit rates.

Michael Kronides, Senior Director of the Association of Banks, described the meeting as constructive and productive, with fruitful discussions held on various matters concerning the Cypriot economy and the banking sector. Topics covered included sanction issues and the divestment framework, both of which were thoroughly examined. Kronides assured the President of the association's commitment to close cooperation for the benefit of the Cypriot economy and the stability of Cyprus.

When questioned about the divestment issue, Kronides explained that several legislative proposals were currently under consideration in Parliament. He expressed hope that these proposals would be discussed in the Finance Committee in the following week, fostering a constructive dialogue that would lead to a favorable legal framework benefiting both borrowers and banks. Kronides stressed the significance of stability in the legal framework, noting that risks would arise if wise decisions were not taken.

Papadopoulos echoed the sentiment that the meeting was useful and productive, emphasizing the President's focus on strengthening the banking system for the betterment of the country's development, economic growth, and investment attraction. He emphasized that a strong and reliable financial system could bring numerous benefits to Cyprus. The government recognized the efforts made in recent years and believed that the reliability of the financial system played a pivotal role in attracting investments and promoting economic growth while prioritizing social sensitivity.

Regarding the proposal put forward by AKEL and other coalition parties concerning divestments, Papadopoulos conveyed the government's stance on preserving vulnerable borrowers and households. He highlighted existing programs such as 'Estia,' 'Home,' 'Rent versus Rent,' and the establishment of a Special Court to address the issue. Additionally, he emphasized the need for a balanced framework that would enable banks to recover owed amounts from borrowers, particularly defaulters. The government's intention was to ensure a sound financial system while protecting the first homes of vulnerable groups. Papadopoulos concluded by assuring that a new plan addressing this matter would be presented to the Cabinet within days for approval.

Cyprus  |  economy  |  banks

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