Cyprus Bank Deposits ‘To Lose 60% Of Value’

Cyprus Bank Deposits ‘To Lose 60% Of Value’

  • Posted: Mar 30, 2013
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Sources suggest some savers in Cyprus could lose 60% of the money they have deposited

Savers with more than 100,000 euros in the Bank of Cyprus could lose up to 60% of their deposits, two senior officials have warned.

The Central Bank official and the Finance Ministry technocrat said sums held at the country’s largest lender will  lose 37.5% of their value after being converted into bank shares.

And the pair said the deposits could lose up to 22.5% more in value, depending on an assessment by officials who will determine the exact figure aimed at restoring the troubled bank back to health.

Both figures were speaking to the Associated Press on condition of anonymity because they are not authorised to publicly discuss the issue.

Cyprus' President Nicos Anastasiades
Cyprus’ President Nicos Anastasiades

It comes after Cyprus agreed on Monday to make depositors contribute to a financial rescue in order to secure 10 billion euros (£8.5 billion) in loans from the eurozone and the IMF.

Cypriot President Nicos Anastasiades defended the bailout deal, saying it had contained the risk of national bankruptcy.

“We have no intention of leaving the euro,” the conservative leader told a conference of civil servants on Friday in the capital, Nicosia.

“In no way will we experiment with the future of our country,” he said.

Cypriots have expressed anger at the price attached to the rescue – the winding down of the island’s second-largest bank, Cyprus Popular Bank, also known as Laiki, and an unprecedented raid on deposits over 100,000 euros.

Under the terms of the deal, the assets of Laiki bank will be transferred to Bank of Cyprus.

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