John Hourican quits as chief of Bank of Cyprus

John Hourican has quit as Bank of Cyprus chief executive less than two years after the former Royal Bank of Scotland executive was parachuted in to turn round the Mediterranean lender that collapsed during a national debt crisis.

The departure of Mr Hourican, who is leaving to spend more time with his wife and four young children at his home in Dublin, comes almost a year after the bank shored up its finances with a €1bn capital increase.

Bank of Cyprus said Mr Hourican, who stepped down as RBS's head of investment banking after its 2013 settlement of Libor manipulation allegations, had a four-month notice period and he "remains at the disposal" of the board, which has started a search for his successor.

Mr Hourican, who was tipped as a contender to fill the soon to be vacant CEO job at Allied Irish Banks, denied that he had lined up a new job. "I have not been in discussions about any job with anyone," he told the Financial Times.

"Of course I'd be interested in time in discussions about other opportunities, but there's no rush," said the 44-year-old, adding that he would like to stay in the British Isles but would consider roles outside of banking.

Under Mr Hourican's leadership, Bank of Cyprus appears to have been stabilised. It returned to a post-tax profit before restructuring costs and discontinued operations last year after two years deeply in the red.

"This is a good time close a chapter on what we've achieved at Bank of Cyprus," said Mr Hourican, who insisted there had been "absolutely no bust-up".

The bank's shares resumed trading in December and the lender's board has been strengthened with the arrival of Josef Ackermann, the former Deutsche Bank chief executive, as chairman, and of Wilbur Ross, the US private equity investor who has taken a stake in the bank, as vice-chairman.

Crucially, with neighbouring Greece facing a fresh political and financial crisis, Bank of Cyprus seems to have benefited by attracting more deposits in recent months.

While the capital controls on moving money out of Cyprus were gradually lifted last year, the bank still managed to increase its deposits in the fourth quarter for the first time since the island's crisis in 2013. This has continued in 2015, the bank said.

Mr Ackermann said: "I wish to express my thanks and appreciation for the remarkable progress achieved under John Hourican's leadership. He leaves behind a strong management team and a bank in a steadily improving financial shape, with restored employee, investor and customer confidence.

"We wish him all the best in his future endeavours and we are looking forward to continuing to work with him in the months ahead."

Bank of Cyprus has held talks with the London Stock Exchange and Euronext NYSE about moving its secondary listing from Greece to the UK or the Netherlands next year. If it did list in the UK, the bank - which has a market capitalisation of €1.9bn - would probably be placed in the FTSE 250, Mr Hourican has previously said.

The bank passed the European Central Bank's stress test last year and its tier one capital ratio - a key measure of financial strength - was a relatively healthy 14 per cent at the end of last year.

Yet after making cumulative net losses of more than €2.6bn in the past three years, it still faces some hefty challenges. Its €12.6bn of bad loans account for more than half its balance sheet. While it has repaid €4.5bn of bailout funding it still relies on loans from the ECB and the central bank of Cyprus for a third of its liabilities.

The bank has sold its Ukrainian and Romanian operations, but it is still working on the sale of Uniastrum, its heavily lossmaking Russian operation for which it paid $576m to gain a controlling stake in 2008.

Last year, Mr Hourican was paid just over €1m, including a €111,000 pension contribution.

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