Rating agencies praise Cyprus after bank, tax moves

Fitch and Moody’s made positive assessments of the Cypriot economy following moves by the government to deal with an upheaval in the banking sector of the Eastern Mediterranean island, statements issued on Thursday said.

Fitch praised the decision by the government to sell state-owned Cyprus Cooperative Bank (CCB) to Hellenic Bank to avoid its liquidation, as it will result in a stronger bank unit second to primary lender Bank of Cyprus.

Moody’s said it expected a stronger banking sector and higher property prices after the waiver of a 20 percent capital gains tax on property sales when proceeds are used to repay problem loans, or when the proceeds come from the sale of properties from credit acquiring companies.

[Xinhua]