The market needs ethical banking, economist and member of the Fiscal Council, Marios Clerides, has said in relation to the effort to create a new cooperative Bank, underlining, however, the need to pay attention to governance issues.
Asked to comment the effort to establish a new Pancyprian Cooperative Bank, Clerides said that there is both a positive and a negative aspect. On the one hand, he said, "the market needs ethical banking, that is, banks that think not only about profits but also about the borrower," that take into account the repayment capacity of their clients and do not rely only on collateral.
On the other hand, he continued, the problem of Cooperatives lies in governance. Specifically, he stated that with the principle of "each member, one vote," which is a basic principle of Cooperatives, "the weaknesses of the political system begin to appear," with each party "wanting to put its own people in."
He also expressed concern about whether this governance logic is fair, for an investor who invested €100,000 to have the same voting rights as someone who invested €100.
"They must handle governance issues and the Board of Directors that will join this organisation must not have political agendas and must implement ethical banking," he said.
Responding to the question of whether it is feasible to issue a license from the Central Bank of Cyprus and the European Central Bank, Clerides said that “they should try,” noting that there are cooperative banks in Europe, such as Rabobank. “The issue is how we can make it work in Cyprus,” he pointed out.
Shares to go on sale from 22 July
The Cyprus Cooperative Holdings and Promotion Company Ltd, whose main purpose is to establish the Cyprus Cooperative Bank, will begin selling shares on 22 July, following approval by the Cyprus Securities & Exchange Commission (CySEC). This company will own 60% of the Pancyprian Cooperative Bank, while 40% will belong to the legal entities and companies of the Cooperative, according to what was said at the recent first meeting held on the matter, following the approval of the prospectus by the CySEC.
The sale of shares for the Pancyprian Cooperative Holdings and Promotion of Cooperatives LTD (Παγκύπρια Συνεργατική Εταιρεία Συμμετοχών και Προώθησης Συνεργατισμού ΛΤΔ) will take place between 22 July and 17 November, 2026, which has as its main purpose the establishment of the Pancyprian Cooperative Bank, Panicos Champas, Chairman of the company's Committee, stated at the company's first official meeting in Nicosia, following the approval of the prospectus by the Cyprus Securities and Exchange Commission.
CySEC approved the Public Offering of up to 42 million new shares, with a nominal value of €1. Interested parties will be able to purchase shares through the Athlos Capital platform, with a minimum purchase of 100 shares.
The event, which took place on 10 July, was attended by a large number of MPs, party representatives, Government representatives, members of the Local Government, union representatives, cooperative representatives and business executives.
In his speech, Champas said that the whole undertaking was and is difficult, "but not impossible", noting that the socio-economic conditions for a new cooperative system have matured. "We will have to find that chemistry that the Cooperative Idea 'each for all and all for each' will work in the new legal framework of the banking sector, with the human at our centre," he said.
Transparency, democratic procedures, consensus and unity
He noted that transparency, democratic procedures, consensus and unity are the qualitative characteristics of the Cooperative Society. "Our Organisation will stand out, because it is born by citizens for citizens, by legal entities operating on the island," he said, while also speaking of "prudent moves" so that the loans that will be given are sustainable and do not end up "in the red."
Criticising the Cypriot banking system, he said that "our Organisation will not follow behaviours and practices as is happening today in Cyprus, where, while the European Central Bank is reducing interest rates, on our island they are rising!"
Furthermore, he mentioned that in 1960 the Constitution of the Republic of Cyprus separated the Credit Sector of Cooperatives into Greek Cypriot and Turkish Cypriot, while the commercial sector remained unified. “Today, in 2026, the Turkish Cypriots maintain the Limassol Cooperative Savings Bank LTD in the occupied territories, which is registered with the Central Bank of Cyprus. Unfortunately, since 2018 we have not had a Cooperative Bank,” he said, noting that the Turkish Cypriot cooperatives participate in the European Association of Cooperative Banks based in Brussels, “while we are absent.”
"We have a duty to re-establish the flag of the Cooperative Credit Sector of Cyprus in the European Association of Cooperative Banks," he said.
Describing the structure of the new Cooperative Bank, Champas said that several cooperative banks were studied to decide on the model to be followed. "We created the Cyprus Cooperative Holdings and Promotion Company LTD, in which the basic principle of Cooperatives,' 'each member, one vote' applies.
This company received approval from the CySEC to purchase shares from the public. This company will own 60% of the Pancyprian Cooperative Bank,” he said. He said that 40% will belong to the legal entities and companies of the Cooperative.
That is why, he said, a new company will be registered in the near future, under the name "Pancyprian Cooperative Company", which, when the necessary licenses are secured, will evolve and be called "Pancyprian Cooperative Bank."
Timetable
Responding to questions from the public regarding the timetable for the establishment of the Pancyprian Cooperative Bank, Champas said that currently "we are working on the application to the Central Bank of Cyprus", which, as he explained, will be submitted simultaneously with the application to the European Central Bank.
Noting that the timetable for approving the permits does not depend on them, he noted that the decision has been made to already begin preparations for the new company, so that when the permits are approved, they will be able to respond immediately and within the deadlines.
Asked whether the new bank will have physical branches, he said that the previous property of the Cooperative has now passed to the state. Without directly answering the question, he said that the new bank will be "very advanced" in terms of technology "and people will be served."
The event was addressed by Kypros Protopapas, Commissioner of the Cooperative Societies and Social Enterprises. As he said, the Service he heads has supported the effort to create a new Cooperative Bank from the beginning, "on a more modern and sound basis" and is assisting in this effort within the framework of its responsibilities.
He noted that the new venture is governed by the laws on cooperative companies, as well as the law on public offering and prospectus of the Capital Market Commission and mainly by the law on the operations of credit institutions and relevant EU legislation, on the basis of which the CBC and the ECB will examine the application for a credit institution operating license to the newly established Pancyprian Cooperative Bank.
A presentation of the platform for purchasing shares was then made by a representative of Athlos Capital.
The Board of Directors of the Pancyprian Cooperative Participation and Promotion Company LTD honored the descendants of the founders of Cooperatives in Cyprus with an honorary plaque.
As Champas mentioned during his speech, Ioannis Economides, Marcos Charalambous and Michalis Papapetrou from Lefkoniko, who in 1909 “sowed and blossomed the idea of Cooperatives in Cyprus.” Later, Nearchos Clerides “placed Cooperatives very high in education,” with the savings banks.
"It was the first organised and successful effort to free working people from usury, in the heart of Mesaoria," he said, noting that "their action inspires us, especially today, and gives us courage."
(Sources: InBusinessNews, CNA)
