LONDON (Reuters) - Bank of Cyprus (CYS:BOCY) has called on a second former senior banker from Royal Bank of Scotland (RBS.L) to lead its restructuring following this year's international bailout of Cyprus.
Euan Hamilton, formerly deputy chief executive of RBS's "non-core division", has joined Bank of Cyprus as a consultant to specifically look at the delinquency, restructuring and recoveries of loans.
Getting to grips with Bank of Cyprus's bad loans is seen as the key issue for its new chief executive, John Hourican, the former RBS investment bank boss who was appointed last month.
Cyprus's turnaround efforts have been hampered by political infighting and there has been criticism over a lack of transparency around bad loans at its banks.
Bank of Cyprus, which is on Tuesday due to report results for the six months to the end of June, became the first bank in the euro zone to force depositors to lose some of their savings to recapitalize the lender after it was crippled by its exposure to Greece.
It also assumed some assets of Laiki, a bank wound down under terms of a 10 billion euro bailout deal for Cyprus with the International Monetary Fund and the European Union.
Bank of Cyprus's recovery could be helped by the creation of a "bad bank" to focus purely on running down about 7 billion euros ($9.5 billion) of non-performing loans and other problem loans, some industry observers and officials said.
In his last role at RBS, Hamilton was responsible for overseeing the sale or run-down of more than 75 billion pounds ($121 billion) of non-core assets over 18 months.
He left RBS around 2010 and joined Cramond Capital Partners, a corporate advisory firm based in Edinburgh. Cramond and Hamilton could not be reached for comment.
Hamilton also worked as head of RBS's leveraged finance and sponsor coverage. Hourican also worked in the bank's leveraged finance arm.
Hourican left RBS in April after the bank was fined for manipulating Libor interest rates. RBS said he had no involvement in, or knowledge of, the Libor misconduct. He had run RBS's investment bank since 2008.
($1 = 0.6190 British pounds)
($1 = 0.7404 euros)
(Reporting by Steve Slater and Marc Jones; Editing by Mark Potter)
- UK International News
- Board & Management Changes
- Bank of Cyprus
- Royal Bank of Scotland