While the rest of Europe appears to be stabilizing (at least as far as the stock markets are concerned), Cyprus remains the odd man out. Stock markets across Europe have seen decent gains for the month of August while Cypriot equities have gotten hammered to the tune of a 21% decline. Even Cyprus' typically conjoined twin Greece has managed to break the correlation (for this month at least) with Greek stocks gaining 6.8%. Here's the bottom 10 performing benchmark equity indexes for the month of August:
This is a warning for those with squeemish stomachs or heart problems, this next chart is not pretty. Here we have the General Market Index CSE (Cypriot benchmark equity index) going back to the beginning of 2011. It's reached yet another new low.
We expect that this news regarding continued losses by Cyprus' largest bank has contributed to the most recent decline
(courtesy of Bloomberg):
Bank of Cyprus Pcl, the island’s largest lender, said its first-half loss widened by 25 percent after increasing provisions for bad loans and reducing the value of Greek government bonds.
The net loss in the six months to June 30 widened to 134 million euros ($167.5 million) from a loss of 107 million euros in the same period of 2011, according to an e-mailed statement today from the Nicosia-based lender.
Bank of Cyprus, which sought aid from the Cypriot government in June to meet capital requirements, said the capital shortfall was defined by the European Banking Association on June 30 at about 730 million euros.
It appears that a scapegoat for the bank's poor performance has been found
(ht to 4-traders.com).
Bank of Cyprus announces that the Chairman of the Board of
Directors, Mr Theodoros Aristodemou, has submitted today his
resignation from the position of Chairman and member of the
Board of Directors of Bank of Cyprus.
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