NICOSIA - A meeting was held Tuesday evening at the Ministry of Finance to discuss the methodology used by US-based investment management firm Pimco and its findings in the due diligence review as regards the amount deemed necessary for the recapitalisation of Cyprus’ banking sector.
The meeting, which lasted two-and-a-half hours, was attended by Minister of Finance Vassos Shiarly, representatives of the Central Bank of Cyprus and parliamentary political parties, and Ministry of Finance officers.
The decision to hold Tuesday evening`s meeting was taken earlier in the day at the House of Representatives, in a meeting attended by Shiarly and Central Bank Governor Panicos Demetriades.
Pimco’s interim report was submitted in early December 2012, while the full report is expected to be delivered by mid-January. According to Pimco’s preliminary results as reported in the press, the banks will need €10.3 billion.
The meeting was called to discuss the methodology used by Pimco and if possible the decrease of the amount of €10.3 billion for the banking sector before Pimco`s full report is handed in and before the next Eurogroup meeting to take place on January 21st.
On Monday, the Central Bank announced that BlackRock, the American multinational investment management corporation and leading asset manager, is the consultancy selected to analyse Pimco’s methodology.
The banks` recapitalisation needs are of crucial importance for Cyprus, as they will determine the size of the bailout required.
Cyprus applied for a bailout on June 25, 2012, after its two largest banks turned to the state for financial assistance, having sustained a severe hit due to their heavy exposure to Greek bonds.