Friday October 31, 2014 Search
Weather | Athens
18o C
13o C
News
Business
Comment
Life
Sports
Community
Survival Guide
Greek Edition
Cyprus comes to terms with testing bailout agreement

 President Anastasiades says deal secures country
A man waits to make a transaction at a Laiki Bank ATM in Nicosia on Monday.

Cypriot President Nicos Anastasiades arrived back in Nicosia Monday to defend a bailout deal with the troika that will see his country’s largest bank restructured and second-largest shut down as part of an overhaul that will cost depositors billions.

“We were a breath away from economic collapse,” said Anastasiades. “Our aim in Brussels was to save the country. We faced some very tough choices.”

The deal agreed between Cyprus and the troika, and which was approved by the Eurogroup, will see Cyprus receiving 10 billion euros in loans, beginning with the first installment in May. However, it will also hit Cyprus’s large banking sector heavily and economists expect the country to experience a severe recession this year.

“I do not want to think about what would have happened if we did not reach an agreement,” he said.

Anastasiades pledged that capital controls – restrictions on the withdrawal and transfer of money – were only temporary and would be gradually relaxed over the next few days once stability has returned to the financial sector.

The president said that pension funds’ bank accounts would be protected and that a criminal investigation would be launched into how Cyprus found itself in such a crisis.

The bailout deal was reached after many hours of talks and following several delays to the start of the Eurogroup on Sunday night.

The deal foresees the country’s second-largest lender, Cyprus Popular Bank (Laiki), going through an immediate resolution process that will see deposits under 100,000 euros, which are guaranteed, being put into a good bank.

Nonperforming loans and uninsured deposits will be placed in a bad bank, which will be liquidated over time. Bondholders and shareholders are also set to lose out.

The good bank will be merged with the country’s largest lender, the Bank of Cyprus. Uninsured deposits at Bank of Cyprus will face a haircut but none of the officials in Brussels was able to say how large the levy would be. It is thought the final figure will be between 30 and 40 percent. The aim is for the healthy bank to achieve a capital ratio of 9 percent.

However, Bank of Cyprus will take over the 9 billion euros of Emergency Liquidity Assistance that the European Central Bank has provided to Laiki.

It is expected that Bank of Cyprus will open on Thursday. Other Cypriot banks, where no haircut will be applied to savings, are due to open Tuesday.

Among the organizations that will suffer losses is the Church of Cyprus. Archbishop Chrysostomos said that the Church had more than 100 million euros in capital, which it will probably lose. Chrysostomos, who has advocated an eventual return to the Cypriot pound, said that local decision-makers should be held accountable for the country’s demise.

“Whoever is responsible for getting us in this state should stand in the dock,” he said. “It is not possible for the people to suffer and there not to be consequences for those responsible.”

ekathimerini.com , Monday March 25, 2013 (21:00)  
Greek PM appoints new defense, development ministers [Update]
PSI victims protest in Athens, Thessaloniki
Archaeologists find underground vault in Amphipolis tomb
Nikos Dendias appointed defense minister
Eurozone inflation up, unemployment steady, Eurostat reports
Eurozone inflation edged up to 0.4 percent from multi-year lows while unemployment was little changed, official data showed on Friday, providing only limited reassurance that a modest econom...
Greek retail sales rise for third month in a row
Greek retail sales by volume rose 7.4 percent in August compared to the same month last year, after a downwardly revised 4.7 percent increase in July, statistics service ELSTAT said on Frida...
Inside Business
BASKETBALL
Obradovic watches Greens thrash his Fenerbahce
The second homecoming of former Panathinaikos coach Zeljko Obradovic, now at Fenerbahce, was not as emotional as last year’s, but it was certainly was the night of an emphatic triumph for th...
SOCCER
Berg returns to add spice to Panathinaikos´s Cup win
The second round of games for the group stage of the Greek Cup produced plenty of interesting games and results in midweek, but it still lags the upset potential that the knock-out stages of...
Inside Sports
COMMENTARY
The judiciary’s responsibility
The reform efforts over the past few years have begun to bear fruit. Greece has improved its standing in the World Bank’s Doing Business rankings, rising 48 positions from 2010 to 61st place...
EDITORIAL
Findings raise eyebrows
An investigation into money transferred to foreign banks by civil servants since 2010, when Greece’s brutal debt crisis erupted, has come up with some striking findings. The checks, which we...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
 RECENT NEWS
1. Greek PM appoints new defense, development ministers [Update]
2. PSI victims protest in Athens, Thessaloniki
3. Archaeologists find underground vault in Amphipolis tomb
4. Eurozone inflation up, unemployment steady, Eurostat reports
5. Nikos Dendias appointed defense minister
6. Police clear apartment used by rebel monks
more news
Today
This Week
1. Man shot dead, woman injured in Vathis square attack
2. Cyprus’s Georgiades bets on economy for Irish-style bailout exit
3. Germany’s 10-year bonds decline before euro-area inflation data
4. New defense minister to be appointed without reshuffle
5. Greek retail sales rise for third month in a row
6. Traffic accidents rise 1.3 pct in August, year-on-year
Today
This Week
1. Austria’s creative bookkeeping beats Greece on secret debts
2. End of reason, end of humanity
3. Clean bill of health for Greek banks from stress tests
4. Samaras pledges action after flash floods in Athens
5. Eurobank, National Bank restructurings eliminate capital gap
6. Athens flood damage assessed, compensation payments to begin
   Find us ...
  ... on
Twitter
     ... on Facebook   
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright © 2014, H KAΘHMEPINH All Rights Reserved.