The Special Administrator in charge of Cyprus Popular Bank has approved the sales of its 21 million shares in Lombard Bank, although it is not clear from the company announcement whether this move was prompted by a prospective buyer or whether a sale process will only now be initiated.

Lombard’s ties with CPB have had a chequered past. CPB, then known as Marfin Popular Bank, acquired a 43 per cent in the Maltese bank in 2007, from Banca della Svizzera Italiana SA, Lugano and other foreign shareholders, for €48.3 million.

Since then, the shareholding increased to nearly 49 per cent; had it managed to break through the 50 per cent threshold, it would have triggered a mandatory bid in terms of the local Listing Rules, to purchase shares from the 1,300 Lombard Bank shareholders at the time.

In 2012, Marfin reported a €3.3 billion loss mainly after taking a 60 per cent writedown of its Greek government bond holdings resulting from the financial crisis. After the bank collapsed, it was rescued by the Cypriot government, which took 84 per cent ownership and split it into a ‘good bank’ which merged with Bank of Cyprus, while the ‘bad bank’ and its subsidiares in places like Ukraine, Romania and Belgrade are in the process of being sold off and shut down.

Lombard Bank recently reported a profit before tax of €7.84 million in 2015, up 25.6 per cent compared to 2014.