Dialogos

Failed IT Project Costs Cyprus Housing Finance Organisation €3.5 Million

Published January 20, 2026, 08:02
Failed IT Project Costs Cyprus Housing Finance Organisation €3.5 Million

A special report by the Audit Office reveals significant financial losses of at least €3.55 million for the Cyprus Housing Finance Organisation (HFC) due to the failure to implement a new Banking Information System (BIS). Despite an agreement for completion by January 2021, the project did not proceed due to problems with the subcontractor and administrative shortcomings within the HFC. This led to continued reliance on the Cyprus Asset Management Company (CAMC) and the upgrading of the old system at additional cost. The report also highlights an irregular modification of the original contract, which violates public procurement legislation. Failure to comply with the initial terms of the contract deprived the HFC of the opportunity to seize a €452,000 performance bond from the contractor. The lack of a fully constituted Board of Directors and General Manager at the HFC for a long period contributed to the delay in decision-making and the failure of the project. The contract modification in 2024 effectively cancelled the original goal of installing a new system. In addition to the financial cost, the project's failure has negative consequences for the services provided by the HFC, as the organization cannot offer modern banking operations. The case highlights the need for better planning, supervision and management of public projects.

Share:
Read Full Article on Dialogos

You Might Also Like

Back to News