Bank of Cyprus GM says not bidding for expensive deposits because has liquidity

ATHENS (Thomson Financial) - Bank of Cyprus Public Company Limited group chief general manager, Yiannis Kypri, said that they are "not bidding aggressively for expensive deposits because we have liquidity and I expect lending volume to rise in the second half of the year".

On an analyst conference call, Kypri explained that the loan to deposit ratio came in at 88.8 percent at the end of the second quarter suggesting that loan book expansion is not draining liquidity, providing a solid base for the execution of its three year plan.

Dependence on wholesale funding is minimal making up only 11 percent of total assets, he added. Kypri underlined that looking forward the bank would continue to attract retail deposits which will accelerate with the opening of new branches.

The chief general manager confirmed that in Greece they have not been able to re-price their loan book as much as they wanted but they expect lending volumes will accelerate.

The bank confirmed its previous guidance for the full year saying it is "comfortable with it" because higher volumes in new markets with larger spreads should offset any seasonality in the second half of the year. [e-mail] ns/jfr COPYRIGHT Copyright Thomson Financial News Limited 2008. All rights reserved.

The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.