At its meeting held today, the Board of Directors of the Bank examined, among other issues, the capital needs of the Bank of Cyprus Group arising from the regulatory requirements of the Central Bank of Cyprus, given the expansion plans of the Group, and decided:

• That the Bank proceeds with a share capital increase before the end of 2005. The share capital increase will take the form of a rights issue.

• At this stage, it is estimated that the total proceeds of the issue will be of the order of C£80mn-C£100mn (euros 138mn - euros172mn).

• The specific details of the issue, such as the ratio of rights to existing shares, the exercise price and the exact size of the issue will be decided by the Board of Directors closer to the time of the issue and will depend on the conditions prevailing at that time in the Cyprus and Greek markets.

• It is anticipated that the issue will take place in the last quarter of 2005.

The proceeds of the issue will be used to strengthen the Group?s capital adequacy and specifically the Group?s Tier 1 capital. The proceeds from the previous share capital increase of the Bank (exercise of Share Warrants 1999/2003 during October and November 2003) have been fully utilised in the strengthening of the Group?s capital.