20 November 2014

Working in close cooperation with the Bank of Tanzania and FBME Bank’s Statutory Manager in Dar Es Salaam, FBME Limited is putting in place measures to create additional liquidity in the Cyprus branch of FBME Bank. This is being done to ensure depositors can escape the tyranny of the maximum daily transaction levels imposed by the Administrator appointed by the Central Bank of Cyprus.

These maximum levels were first EUR 10,000 per diem, then EUR 5,000 and have been now cut to EUR 2,000. They were put in place to do what, exactly? Apart from the wielding of power for its own sake, they have certainly not helped depositors, whatever is being said.

As is well-known, considerable liquidity exists within FBME Bank as a whole. The Bank remains the juicy plum it was in July. The efforts made by FBME Ltd and the Bank of Tanzania will free up funds for customers of the Cyprus branch, as long as they get the cooperation of the Administrator and his masters at the Central Bank of Cyprus. However, at the moment this appears not to be forthcoming.

Ultimately, one supposes that the primary role of the Central Bank is the protection of the banking system and its customers, so how does the current lack of cooperation to assist in this matter achieve this objective? More strangeness from Kennedy Avenue, we fear.