Audit office report estimates two billion euro burden from cooperative bank collapse

A new special report by the Audit Office of Cyprus, released on November 4, 2026, estimates that the state's total fiscal burden from the Cooperative Bank (SKT) rescue between 2014 and 2030 will reach approximately €2 billion. This figure encompasses the initial €1.5 billion recapitalization (net of recovered funds), an estimated €340 million shortfall from the 2018 state aid, and €200 million in financing costs. The report highlights significant management failures, including weak oversight of Altamira Cyprus, issues with property valuations, and concerns regarding staff recruitment and salary policies at KEDIPES, the entity tasked with managing the bank's remaining assets.

The report notes that while KEDIPES generated €3.009 billion in cash inflows through March 2026—with 56% directed toward repaying state aid—a challenging portfolio of assets with a nominal value of €2.4 billion, mostly non-performing loans, remains to be managed by 2030. Additionally, the Audit Office identified potential multi-million euro losses arising from the divestment of shares in cooperative commercial companies. Separately, reports indicate that a formal police complaint has been filed regarding potential criminal offenses linked to past loan approvals, signaling an escalation in the ongoing scrutiny of the bank's historical operations.