Who’s In Charge at the CBC?

18 June 2015

It has now become apparent that there does not seem to be anyone really in charge of the Central Bank of Cyprus (CBC) governing its actions towards FBME’s Cyprus branch. Well, no one senior that is.

The Resolution Authority may have fallen apart with the actions taken against FBME last July that do not seem to have involved the Authority as a whole (see Stavros Zenios’ letter of resignation from the CBC board of directors). Then the resignation of the CBC’s executive director, Stelios Kiliaris, in March reduced the three-man Resolution Committee to two, one of whom is the Governor who is a lame duck after undergoing highly serious Parliamentary and police investigations.

That leaves just the Resolution Unit, headed and almost solely staffed by one person, Michalis Stylianou, a relatively lowly CBC official who, it is suggested, has shown strong personal animosity towards FBME that pre-dates this episode. Surely, for the good of everyone, it is not he who is calling the shots while senior officials are distracted by other events! Stylianou is the one who was arrogantly rude to senior authorities from the Bank of Tanzania. It is known that he was the day-to-day controller of the last Administrator, Dinos Christofides but it is thought that the more worldly-wise Andrew Andronikou would have seen through him.

Having said that, Andronikou needs to be in Cyprus a little more often if he is to judge the competence of the people who represent his ‘client’. At the moment he does barely two or three days a week at FBME’s Cyprus branch and is suspected of spending the rest of his time in the UK. Not bad if you consider the EUR 50,000 a month he is able to pocket. However, this commuting to London must be stretching the 10 per cent agreed limit on expenses for flights and hotel bills.

That takes us back to where we came in on this blog: Who is in charge of the FBME assignment at the CBC? The ICC Tribunal enjoined both sides to work together to improve the administration of the branch and, as we have recorded frequently on this website, FBME owners, directors and management have on many occasions shown their willingness to make this happen. So far nothing, absolutely nothing, has come back from the CBC. Could that be because there is actually no one with the authority who can respond? That would be a very poor state of affairs for the CBC and for the banking sector in Cyprus as a whole.