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Oliver Gatschke: There is no comparison to 2013

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He noted that the bank has a total of €6 billion in deposits with Central Banks, which are immediately liquid

Όλιβερ Γκατσκε: Δεν υπα&rho ;χει σύγκριση με το 2013

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Nothing compares to 2013, said Hellenic Bank Chief Executive Oliver Gatzke, adding that the bank's management is monitoring the situation daily.

In a meeting with reporters after the publication of the financial results for 2022, Mr. Gatzke said that the bank had received questions from supervisors regarding possible exposure to foreign banks and added that there was no cause for concern.

In general, the German banker said that the big difference since 2008 is that banks in Europe and Cyprus have significantly strengthened their capital ratios and liquidity ratios, thanks also to stricter supervision.

“Look at the banks today compared to ten years ago, there is capital, there is a lot of liquidity and when you look at Hellenic Bank there is even more capital and even more liquidity,” he said.

“Oversight has been beneficial,” he said in response to a question, adding that he feels “very comfortable with supervision as the Cypriot banking system has improved significantly and that was because of supervision and at the end of the day the banks are safer”.

Mr. Gatzke highlighted the very different model followed by Hellenic Bank and the Cypriot banking system in general compared to that of the American Silicon Valley Bank, which collapsed due to the flight of deposits from startups and venture capitals.

Hellini added that it mainly has domestic retail depositors with the majority of them being insured deposits (up to €100,000).

“It is not comparable to 2013 where a large part of the deposits came from the foreign”.

He also noted that the bank has a total of €6 billion in deposits with Central Banks, which are immediately liquidable.

As he said, the liquidity coverage ratio is at 440% compared to the supervisory limit which is at 100%. .

We have, he noted, the highest or second highest liquidity coverage ratio among banks supervised by the ECB.

Mr Gatzke said the bank's bond portfolio (totaling €4.2bn at the end of 2022) is invested in highly rated bonds, Cypriot bonds as well as high quality covered bonds with an average maturity of three years .

Furthermore, to a question about interest rates, Mr. Gatzke said that the expectation is that the ECB will proceed with a new interest rate increase but perhaps at a lower rate.

Regarding new lending, the German banker said that at this time it is important to keep credit standards very high and not simply accept higher installments without an increased own contribution, whether it concerns households or businesses. “given the developments, he estimated that new lending will slow down”, he added.

Regarding existing lending, he said that the majority of loans, approximately 85%, are based on the base interest rate and not on Euribor.

In relation to deposit rates, Oliver Gatzke said that the bank will slowly move towards increases for regular term deposits.

In 2024 the dividend payment

Furthermore, regarding the distribution of dividends to shareholders, Mr. Gatzke reiterated that the bank will discuss the issue with the supervisor (Uniform Supervisory Mechanism) for the payment of a dividend in 2024 for the year 2023.

Saying that a decision from the supervisor is expected around the end of the year or next year

“But looking at our key performance indicators (KPIs) we believe we can pay a dividend, it's time to start the dividend payment at some point”, he emphasized.

Source: www.kathimerini.com.cy

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