The sad fate of Cyprus FBME

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Despite the best efforts of the Tanzanian Bank FBME to save their Cypriot subdivision, unfortunately it will not be saved. The Central Bank of Cyprus have stuck to their positions and will take all necessary measures to close the bank.

Not long ago, the bank’s management filed a lawsuit with Cyprus arbitration to stop the process of closing a bank in Cyprus. Arbitration upheld only one requirement for the admission of the Bank’s employees in the bank’s premises. In order to stop the liquidation process, the bank of Cyprus refused arbitration.

I recall that FBME was very popular among Ukrainian and Russian businessmen. The bank suspended operations in 2014, when they were charged with money laundering offenses.

Those that have ‘frozen’ money in FBME will receive 100,000 euros compensation in a scheme devised by the ECB. Liquidation of the bank is a very expensive procedure, especially because the process is complicated and long. As if it’s not inconvenient enough, existing depositors must now pay for the process due to their contributions to the bank & funding for current deposits between companies and individuals. Therefore, when choosing a bank to invest in, you should always take into account the risks involved.