The Bank of Cyprus Group recently announced the successful completion of the EU-wide stress test for 2023. The results of the test have highlighted the Group's resilience under adverse conditions, showcasing its ability to maintain organic profitability and sufficient capital even under extreme macroeconomic assumptions. 

According to a press release by the bank, the outcomes for the Group, as well as its ability to withstand the parameters of the adverse stress test scenario, have shown significant improvements compared to the corresponding exercise conducted in 2021.

In the adverse scenario, the capital depletion of the CET1 FL ratio over the 3-year horizon ranges from 300 to 599 basis points, which is a notable improvement compared to the 600 to 899 basis points recorded in the 2021 stress test. Furthermore, the CET1 FL at the end of 2025 falls within the range of 8% to 11%, surpassing the capital requirements of the Bank.

It is important to note that the stress test is not a "pass-or-fail" exercise, and there is no specific threshold set to define the failure or success of banks. However, it serves as a crucial input in the Supervisory Evaluation Process (SREP).

Meanwhile, Hellenic Bank, one of Cyprus' leading financial institutions, has emerged as the most robustly capitalized systemic bank in the country following the successful completion of the European Central Bank's (ECB) stress test for 2023.

According to a press release, the stress test results confirm its position as the most adequately capitalized systemic bank in Cyprus, both under baseline and stress conditions. The results also reflect a more resilient credit risk profile for the bank.

The ECB stress test results have shown significant improvement compared to the previous exercise conducted in 2021, further affirming Hellenic Bank's strong capital adequacy position and demonstrating the bank's resilience and positive credit outlook under stress conditions.

This is supported by the Min Capital position under the Stress horizon, which has exhibited a two-notch upgrade in the ECB Bucket classification, as well as in the Max Capital depletion, which has exhibited a one-notch upgrade.

In addition, Hellenic Bank has made an official announcement on the Cyprus Stock Exchange regarding the termination of its Chief Executive Officer, Mr. Oliver Gatzke's employment contract. The decision, which was communicated by Mr. Gatzke himself, will come into effect on July 22, 2024, the contract's expiration date. The departure of the CEO was characterized as amicable and mutually agreed upon, according to the bank.

In compliance with the terms of Mr. Gatzke's employment agreement, the Bank has decided to place him on garden leave with full benefits, effective immediately and until further notice.

In light of these developments, Mr. Antonis Rouvas, the Bank's Chief Financial Officer, has been appointed as the Interim Chief Executive Officer. In response to the situation, Mr. Rouvas emphasizes that Hellenic Bank will remain steadfast in its commitment to its goals, ensuring smooth operations that continue to support customers and the Cypriot economy. His primary focus is on reinforcing the Bank's business model and successfully executing the transformation plan.

Additionally, Ms. Maria Kelesi, the Chief Accountant of the Bank, has been appointed as the Interim Chief Financial Officer, further solidifying the Bank's leadership team during this transition period.