Bank of Cyprus completes acquisition of CDB loans and deposits

Nicosia, Cyprus. Bank of Cyprus has finalised the purchase of approximately €130 million in performing loans and around €440 million in deposits from Cyprus Development Bank (CDB), the banks announced on Wednesday. They said all necessary regulatory clearances had been secured.

Scope and financial terms

The banks said the deal, agreed in March, transferred substantially all performing loans and deposits held by CDB, alongside selected additional assets and liabilities. The purchase price was close to book value.

CDB said the consideration was nearly at par, putting the estimated total discount on transferred assets at approximately €2.8 million. According to the banks, any amount needed to balance the transaction was paid in cash.

Expected impact on Bank of Cyprus

Bank of Cyprus Holdings said it anticipated a modest improvement in the group’s income statement from the acquisition, with a capital impact limited to approximately 30 basis points.

The group described the terms as normal commercial terms and said the purchase supported its medium-term strategy to increase performing lending and deposits. It also expected the transaction to broaden its customer base.

The group reiterated that pursuing organic growth alongside acquisitions remained a strategic priority, aimed at generating attractive, sustainable returns and shareholder value.

CDB’s continuing responsibilities

CDB described the transfer as an appropriate measure that considered its stakeholders’ interests, including those of depositors, creditors, bondholders and shareholders. It said arrangements were in place to maintain uninterrupted customer service.

The bank said it would retain responsibility for servicing and managing assets and liabilities outside the deal, including its Tier 2 subordinated bonds, under their existing contractual terms.