A Cypriot bailout would not affect Lombard Bank, even though its largest shareholder is a bank in Cyprus that is most exposed to Greek debt.
It holds no exposure to non-Maltese securities
Lombard Bank is on a sound footing and unaffected by the situation in Cyprus, according to CEO Joe Said.
“There is nothing to worry about. Lombard is an independent and autonomous bank and there is nothing that could affect Malta or the bank,” he said when contacted.
On Friday, international media were reporting that Cyprus was seeking bailout funds from the EU to recapitalise a banking sector pummelled by exposure to Greek debt.
Cyprus Popular Bank, the country’s second largest lender and the most exposed to the risk of Greek debt, holds 49 per cent shares in Lombard Bank.
In a company announcement in February, Lombard had already reassured shareholders that this Cypriot bank was not a majority shareholder in the bank.
Lombard also said it held “no financial exposure whatsoever” to a member of this bank or any other Greek or Cypriot entity.
“Lombard holds no exposure to any form of non-Maltese sovereign or corporate securities.”
Just three weeks ago, Lombard released another company announcement to say that in the light of the international economic climate, it continued to follow “a prudent and cautious policy”.
In 2011, Lombard Bank Group – which includes the bank and Redbox Ltd – registered a profit of €7.2 million after tax, and on a bank level, a profit of €6 million after tax.
On the other hand, Cyprus Popular Bank posted a record €2.5 billion loss last year after taking a 76 per cent write-down on its Greek government bond holdings.
Mr Said would not be drawn into “speculating” when asked if the worst case scenario would be for Cyprus Popular Bank to sell its Lombard shares, but said Malta was one of the Cypriot bank’s better investments.