Romania indicts chairman of Banca Transilvania

Banca Transilvania , Romania’s second-largest listed bank, has denied any knowledge of wrongdoing after the bank’s chairman was indicted by prosecutors on charges of money laundering and manipulating the market.
The DIICOT office for fighting organised crime said Chairman Horia Ciorcila benefited from privileged information that Bank of Cyprus intended to acquire a stake in his bank.

Banca Transilvania said in a statement it was giving full support to authorities “for the fast and transparent resolution of this case”.

“The board of Banca Transilvania does not have any knowledge of any ill-willed action of any of its members and trusts the moral and professional credibility of all its members.”

Ciorcila added in a statement: “The accusation is completely groundless, I’ve done nothing illegal, nothing to break the law … and I will resort to all legal means to prove this.”

DIICOT said Ciorcila sold 8.9 million of shares to Bank of Cyprus through his own Cyprus-based offshore firm in 2009.

In June Bank of Cyprus withdrew an application to raise its stake in the Romanian bank to up to 20 percent citing “other priorities” for its decision to withdraw. [ID:nLDE65F0L8]

At 12.33 GMT shares in Banca Transilvania were down 4.3 percent, versus a 2.4 percent fall in the wider blue-chip index .

The share fall “is directly relating to the news,” Paul Brendea, operations director at brokerage house Prime Transaction, told Reuters by telephone. “Though I wouldn’t foresee any significant impact on shares on a longer term.”

The prosecutors’ office also said Georgios Christofourou, director of the Romanian branch of Bank of Cyprus, and another employee Anastasios Isaakidis gave Ciorcila privileged information that their bank was seeking to buy a stake in Banca Transilvania.

It said Christofourou and Isaakidis concluded deals in Banca Transilvania shares and consequently sold those bought in their own names for an illicit profit of 196,505 lei ($58,410).

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