The Bank of Cyprus Group does not expect negative consequences, as a result of today's decision by Fitch Ratings, the international rating agency, to downgrade its long-term rating to ‘Α-‘ from ‘Α' and its short-term rating to ‘F2' from ‘F1'. The outlook on both the long and short-term ratings is stable. It is noted that, due to the international economic slowdown, the credit ratings of a lot of banks and financial institutions have recently been downgraded.

The Bank of Cyprus Group's revised ‘A-‘ and ‘F2' ratings are still the highest among Greek and Cypriot banks that have recently been rated by Fitch Ratings.

The international rating agency Fitch Ratings views positively the good performance of the Group's Greek operations, which have sound risk management controls in place, and a significant contribution to the Group's profitability, despite bearing the additional costs of several new branch openings.

The main reasons that have led to the downgrade of the Group's long and short-term ratings are, per Fitch Ratings, the result of the economic slowdown in Cyprus, further falls in the domestic stock market, and a narrowing of net interest margins following the interest rate cuts in 2001.

Fitch Ratings also notes the fact that the Cyprus economy is sensitive to external factors, as its main drivers, tourism and financial services, are affected by the uncertain outlook for the global economy.

Nicosia, 4 February 2003

Founded in 1899, the Bank of Cyprus Group is the leading Cypriot banking and financial services group. The Group has been expanding rapidly in Greece. It has an established banking presence in the United Kingdom and in 2001 it expanded to Australia. Internationally, the Bank of Cyprus Group seeks to serve the expatriate Greek and Cypriot communities. In addition to retail and commercial banking, the Group's activities include finance, factoring, investment banking, brokerage, venture capital, fund management, custody, life and general insurance. The Group currently operates through a total of 279 banking outlets, including 75 in Greece, seven in the United Kingdom, eight in Australia and one in the Channel Islands. Bank of Cyprus also has representation in the United States of America, Canada, South Africa, Russia and Romania. At 30 September 2002, the Group's Total Assets reached C£7,9bn (?13,8bn) and the Group's Shareholders' Funds were C£535mn (?932mn). The Bank of Cyprus Group employs 5.485 staff worldwide. The Bank of Cyprus shares are listed on the Cyprus and Athens Stock Exchanges. Additional information may be found at www.bankofcyprus.com.