We must return to Cyprus Popular Bank, the bank that’s essentially forcing Cyprus to seek a bailout – something that may well be announced some time this weekend. Most reports say that it’s problems are down to write-downs following the Greek restructuring. True, the value of Popular Bank’s investment in Greek sovereign debt was written down to €710m from €3.05bn. But there’s more to the story, which involves inter alia speculating monks, unusual lending practices and a man called Andreas Vgenopoulos.
Crucially, it suggests that concerns about the quality of the bank’s assets could be an important reason for why private sources cannot be found to fund the €2bn capital shortfall.
Reuters has a fascinating report looking into the history of the bank, which used to be called Marfin Popular Bank until the government took over managing it in May.
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