Bank of Cyprus to cut 30% off deposits over €100,000
Cyprus faces years of suffering
Cypriots face years of economic hardship due to a harsh eurozone bailout deal, while the Mediterranean island's future in the single currency remains deeply uncertain, analysts said Monday.
The fallout will begin immediately with food and medicine shortages likely in coming weeks as businesses struggle with a lack of cash in Cypriot banks, which were hammered by the agreement, said economic experts.
The tiny nation then faces two years of deep recession coupled with soaring unemployment, with few hopes of longer-term recovery as Russians and other foreign investors will steer clear of its devastated financial sector.
Fiona Mullen, an economist specialising in Cyprus, said that while the deal had prevented an overnight exit from the euro many Cypriots would wonder if it would be better off leaving anyway.
"They feel very betrayed by an awful lot of countries in this and I think that there are going to be longer term implications," Mullen told AFP.
Bank of Cyprus to cut up to 40% off deposits over €100,000
UPDATE : latest estimates are "Bank of Cyprus to cut up to 40%off deposits over €100,000"
could be 100% by the end of trade tomorrow at this rate
surely its not that wise to rip off the "Russians"
just hope there's enough Horses heads left to go around
Now that it is done what will prevent them to do the same thing anywhere else in the world? You can save your money only if you do not show it to them (be sure that soon they will start adding multiple accounts you have together so that you do not escape)
Now we have to pay to banks to keep our money with them and they take as much as they think they need? Nonsense of the century ...
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Depositors in the Bank of Cyprus, the biggest bank on the island, will reportedly lose 30 percent on their holdings above 100,000 euros, the chairman of the Cypriot parliamentary finance committee said on Monday.
"I haven't heard a formal announcement about the haircut, but this is the figure I heard," Irish radio quotes Nicholas Papadopoulos as saying.
At dawn on Monday, Cyprus and the troika of international backers (EU, ECB, IMF) reached agreement on a €10bn bailout plan, aimed at preventing the bankruptcy of the island’s financial system and the country’s exit from the Eurozone.
Under the plan the depositors in Bank of Cyprus will be compensated with equity in the bank, while Laiki Bank, which is the island’s second largest financial institution, will be closed down.
Those with deposits under 100,000 euros in both banks will continue to enjoy the protection of the state's guarantees, after an earlier proposal to impose a 6.75% tax on them provoked anger.
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