FBME holds Central Bank liable for losses Updated

first_imgBy a Staff ReporterTHE holding company of FBME Bank and the Central Bank of Cyprus (CBC) traded barbs on Thursday after the former said it held the CBC liable for damage and loss suffered by the lender, its depositors and owners.“Those persons considered responsible include but are not limited to the special administrator appointed by the Central Bank to control the operations of the Cyprus branch of FBME Bank,” a statement from the holding company said .The stated intention of the Central Bank has been to expropriate the Cyprus branch and to sell it to outside interests against the wishes of its owners, the holding company said.“Resolution powers have been imposed against the Cyprus branch of the Bank, whereas those powers were designed only for institutions facing insolvency, not healthy banks such as FBME.”The shareholders are seeking a legal solution to the actions of the CBC and its administrator, in line with protection afforded under Cypriot, EU and international law.Last week, the shareholders filed a request for arbitration with the Arbitral Tribunal of the International Chamber of Commerce to counter the unilateral decision of the CBC to sell FBME Bank’s Cyprus branch.The CBC took over the branch in July after the US Treasury said Tanzania-based FBME Bank had been deemed a “primary money laundering concern.”The CBC said it was selling the branch to protect depositors and prevent contagion after correspondent banks froze and/or closed the branch’s US dollar accounts and have suspended transfers on behalf of the branch.The lender denied the allegations and described the CBC’s move as a hostile takeover.Hitting back, the Central Bank issued its own statement denying any hostility toward FBME.“As soon as the problem was created, the actions of the Central Bank have been geared at normalising the operations of the FBME Cyprus branch and protecting its depositors,” the CBC said.“Unfortunately, the whole effort is being hampered not only due to the refusal of correspondent banks to work with the bank…but also due to the actions of the bank owners themselves.”The CBC cited a number of reasons why transactions by customers of FBME Cyprus branch are being obstructed.The Cyprus branch is not in a position to use the Single Euro Payments Area (SEPA), a payment-integration initiative of the European Union for simplification of bank transfers denominated in euros.In addition, the administrator appointed by Tanzania’s central bank, appointed to run the operations of FBME headquarters there, has halted SWIFT payments by the Cyprus branch.Lastly, the CBC said, FBME and its shareholders have blocked the use of deposits the Cyprus branch holds in other banks.The CBC claimed also the governor agreed to see the FBME owners, at their request, but that the latter cancelled the meeting at the last minute.“In spite of the serious difficulties, the special administrator…is making every possible effort in order that transactions by the bank’s customers may gradually recommence,” it added.The regulator said it “does not deign to comment on salacious allegations” to the effect that the Central Bank, by taking over FBME Cyprus, is serving the interests of other quarters.You May LikePopularEverythingColorado Mom Adopted Two Children, Months Later She Learned Who They Really ArePopularEverythingUndoLivestlyChip And Joanna’s $18M Mansion Is Perfect, But It’s The Backyard Everyone Is Talking AboutLivestlyUndoYahoo SearchYou’ve Never Seen Luxury Like This On A Cruise Ship. Search Luxury Mediterranean CruisesYahoo SearchUndo Pensioner dies after crash on Paphos-Polis roadUndoCruise passenger airlifted to Paphos hospitalUndoRemand for pair in alleged property fraud (Updated)Undoby Taboolaby Taboolalast_img

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