Cyprus Mail www.cyprus-mail.com
Tuesday, May 21, 2013
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BoC caught in the line of fire Tensions between government and the central bank add to delays in the restructuring By Elias Hazou
F
URTHER signs emerged yesterday that Bank of Cyprus (BoC) has been reduced to a hapless hostage caught in crossfire between the government camp and the banking regulator. A legislative proposal spearheaded by DISY envisages increasing the number of board members at the Central Bank of Cyprus (CBC) from five to seven, two of whom will act as executive directors. The bill is co-sponsored by DISY’s Averof Neophytou, DIKO’s Nicholas Papadopoulos, the Greens’ George Perdikis and the European Party’s Demetris Syllouris. The point of contention is a clause stipulating that, though final decisions rest with the governor of the CBC, the latter must have the consent of the board’s majority. The bill, discussed yesterday at the House Finance Committee, struck a raw nerve with CBC officials arguing it would dilute the powers of the CBC chief and that it was possibly unconstitutional. Weighing in, opposition AKEL charged the DISYled government of trying to place the regulator un-
der its thumb. AKEL MP Stavros Evagorou said the bill seeks to “turn the Central Bank into a branch of DISY.” But DISY’s Neophytou countered that the proposal related to the management and running of the regulator and had nothing to do with issues of monetary policy which remained the exclusive domain of the CBC chief. Debate on the bill is set to continue into next week. The CBC meanwhile has been without a board since April, when three of the remaining board members quit. The government has yet to appoint replacements. But in a roundabout way, the lack of a board at the CBC has in turn impacted on Bank of Cyprus (BoC), which since March has been placed under the regulator’s administration as it undergoes restructuring. Under a deal with international creditors - for which Cyprus will receive a maximum of €10bn - an independent valuation of BoC must be completed by the end of June. Cyprus had to meet certain conditions to obtain the funds. They included forcing depositors to take
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Civil servant sock ban in broiling Pakistan
Model Alyson Le Borges poses on the red carpet as she arrives for the screening of the film Blood Ties during the 66th Cannes Film Festival in Cannes last night
PAKISTAN has told civil servants not to wear socks as the country turns off airconditioners amid a chronic power crisis and soaring temperatures. The government has turned off all air-conditioning in its offices as the country endures blackouts of up to 20 hours a day in some places. “There shall be no more use of air-conditioners in public offices till such time that substantial improvement in the energy situation takes place,” a cabinet directive said. As part of a new dress code, moccasins or sandals must be worn without socks. The power shortages have sparked violent protests and crippled key industries, costing hundreds of thousands of jobs in a country already beset by high unemployment, a failing economy, widespread poverty and a Taliban insurgency. The “load-shedding” means many families cannot pump water, let alone run air-conditioners, with a disastrous knock-on effect on health and domestic life. Frustration over the power cuts contributed to the former ruling party’s poor showing in a May 11 general election. Two ministers in charge of water and power explained what can be done to end power cuts in parts of the country enduring temperatures of 40 degrees Celsius and above absolutely nothing, it seems, except raise prices. Ministers Musadiq Malik and Sohail Wajahat Siddiqui “expressed their inability to overcome the crisis”, the Daily
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