THE anticipated public showdown yesterday between the new Executive Chairman of Marfin Investment Group (MIG) Andreas Vgenopoulos and some of the official figures he criticised at last month’s annual general meeting of Marfin Popular Bank (MPB) proved to be something of an anti-climax.
Vgenopoulos had been invited to attend yesterday’s Institutions Committee meeting at the House of Representatives to answer questions on his comments at MPB’s AGM, where he had blasted what he saw as the nepotism, gerontocracy, bureaucracy, vested interests and “selective supervision” that operate in Cyprus.
Also invited were Finance Minister Charilaos Stavrakis, Central Bank (CB) Governor Athanasios Orphanides, Securities and Exchange Commission (SEC) Chairman George Charalambous, and 76-year-old Eurocypria Executive Chairman Eleftherios Ioannou.
In the event, only Charalambous attended in person, with Orphanides away at a conference in Oslo and Stavrakis otherwise engaged.
House Committee Chairman Rikkos Erotokritou opened the proceedings by itemising six points which he wanted the meeting to address, saying that “Mr Vgenopoulos has, for the best of reasons, thrown down the gauntlet to the nation’s institutional framework, a challenge that first of all involves the political framework”.
Vgenopoulos was on his best behaviour as he made his opening comments, pointing out that he had cancelled “an enormous number of outstanding engagements” in order to take up the opportunity to express his opinions.
In his main contribution, Vgenopoulos said that “the supervisory system in Cyprus is lax in some places and strict in others, which prevents banks from growing”, and repeated his view that the supervisory system in Greece is stricter. He added that he had “not taken the initiative to leave, you had taken the initiative of driving me out”.
He gave a series of examples to argue his case, including a detailed explanation why he thinks that Bank of Cyprus (BoC) has been given more leeway by the Central Bank than MPB in complying with capital ratio requirements. At one point, he asked the CB representatives whether MPB would be allowed to maintain 6.8 per cent Tier 1 capital – as does BoC – rather than its current 8 per cent, thereby freeing up €6.7 billion liquidity. The CB representatives replied that capital ratios are agreed on an overall basis, not by single category.
He summarised his argument by saying: “I hope that what I have talked about demonstrates that you are not conservative, that we are not moving to Greece because they are more flexible, and thirdly that we are leaving because in Cyprus you cannot become a financial centre with the existing institutional framework.”
Vgenopoulos did withdraw one comment he made at the MPB AGM, apologising to the absent Eurocypria head Eleftherios Ioannou for “overstepping the mark” in his comments regarding gerontocracy. However, some sparks did fly when SEC head George Charalambous objected to Vgenopoulos’s “unacceptable criticism” of his alleged lack of objectivity.
The meeting overran without MPs getting the chance to ask questions. Erotokritou asked Vgenopoulos to come back in two weeks, this time with the Finance Minister and other key players in person. Vgenopoulos agreed, on condition that a dialogue during which “something might change” is made possible by the written comments invited from all concerned by Erotokritou.
