News / Europe

Cyprus Banks Reopen, Bailout Negotiations Continue

Banks Re-Open in Cyprus as Bailout Negotiations Continuei
X
March 28, 2013 5:14 PM
Banks across Cyprus reopened as scheduled Thursday, nearly two weeks after being shut down amid the country's brush with economic collapse. Meanwhile, the government continues to negotiate a bailout agreement with international creditors that will see large depositors lose a portion of their money. Jeff Custer reports.
Jeff Custer
Banks across Cyprus reopened as scheduled Thursday, nearly two weeks after being shut down amid the country's brush with economic collapse. Meanwhile, the government continues to negotiate a bailout agreement with international creditors that will see large depositors lose a portion of their money.

Depositors formed long lines on the sidewalks and streets outside their banks long before the doors were unlocked at noon, local time - anxiously awaiting access to their accounts.

The banks were scheduled to stay open for just six hours, with customers only allowed to withdraw $383 a day.

Travelers leaving the Mediterranean island can take no more than $3,831 to other countries.

Cyprus Bailout

  • Agreed to on March 25
  • Worth $13 billion
  • Keeps Cyprus in the eurozone
  • Closes the island nation's second largest bank - Laiki Bank
  • Laiki accounts larger than $130,000 will be moved to a "bad bank" and used to raise bailout money
  • Laiki accounts with less than $130,000 euros will be moved to Bank of Cyprus
  • Bank of Cyprus will be restructured
The restrictions are part of the deal negotiated with the nation's creditors, including the European Union.  European Commission Spokesman Sebastian Brabant says the restrictions are needed to maintain financial stability:

"Cyprus is facing exceptionally difficult circumstances including a very real risk of uncontrollable capital flight," said Brabant. "Therefore, the Commission considers, having made a preliminary assessment of the Cypriot laws, that the conditions for restricting free movement of capital are met in Cyprus at this stage."

The Cypriot cabinet met Thursday at the Presidential Palace to discuss terms of the bailout agreement.    

European financial markets were steady Thursday as the banks reopened.  Economist Pier Carlo Padoan said the markets were no longer concerned about the situation in Cyprus:

"If we have to judge from what has been happening in the last few days, we take the message that markets are not particularly worried about Cyprus and that the positive fact that I alluded to previously, the fact that the overall systemic risk of the region had been going down, is not going to be changed by what is happening in Cyprus," said Padoan.

Security was tight Wednesday evening as armored trucks delivered thousands of euros to the Bank of Cyprus, while employees prepared to resume operations.

Cyprus banks have been closed since March 16 while the government negotiated a $13 billion bailout from European neighbors, the European Central Bank and International Monetary Fund.  As part of the deal, Cyprus agreed to confiscate 40 percent or more from the biggest, uninsured accounts above $130,000 to help pay for the rescue.

  • People line up outside a branch of Cyprus' Housing Finance Corporation, a state-run bank that mainly helps low and middle income people, in capital Nicosia, March 29, 2013.
  • Supporters of the extreme right group National Popular Front (ELAM) take part in an anti-bailout protest outside parliament in Nicosia, Cyprus, March 28, 2013.
  • A Laiki Bank manager helps a police officer enter the bank after getting past depositors waiting outside the bank's branch in Nicosia, Cyprus, March 28, 2013.
  • People wait to enter at a branch of Laiki Bank shortly after it opened in Nicosia, Cyprus, March 28, 2013.
  • People wait for the opening of a branch of Laiki Bank in Nicosia, Cyprus, March 28, 2013.
  • A man walks with a parrot on his hat in front of a Bank of Cyprus branch before it opens in Nicosia, March 28, 2013.
  • A man reacts outside a branch of the Bank of Cyprus in Nicosia, March 28, 2013.

You May Like

Israelis Quietly Expand Enclave in Palestinian District of Jerusalem

Estimated 500 settlers, armed or protected by paramilitary police, live in Silwan among 50,000 Palestinians More

Video US, Iran Face Similar Challenges in Syrian Fight Against IS

Both Washington, Tehran back fighters battling Islamic State militants in Iraq -- but in Syria they support opposing sides in country’s civil war More

China Boosts Efforts to Help Afghan, Regional Stability

Observers say China’s increased regional involvement are due to concerns that Afghan instability and the presence of anti-China militants in Pakistani border areas could fuel Xinjiang troubles More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
After Decades of Pressure, Luxembourg Drops Bank Secrecy Rulesi
X
October 21, 2014 12:20 AM
European Union finance ministers have reached a breakthrough agreement that will make it more difficult for tax cheats to hide their money. The new legislation, which had been blocked for years by countries with a reputation as tax havens, was approved last week after Luxembourg and Austria agreed to lift their vetoes. But as Mil Arcega reports, it doesn’t mean tax cheats have run out of places to keep their money hidden.
Video

Video After Decades of Pressure, Luxembourg Drops Bank Secrecy Rules

European Union finance ministers have reached a breakthrough agreement that will make it more difficult for tax cheats to hide their money. The new legislation, which had been blocked for years by countries with a reputation as tax havens, was approved last week after Luxembourg and Austria agreed to lift their vetoes. But as Mil Arcega reports, it doesn’t mean tax cheats have run out of places to keep their money hidden.
Video

Video Kobani Refugees Welcome, Turkey Criticizes, US Airdrop

Residents of Kobani in northern Syria have welcomed the airdrop of weapons, ammunition and medicine to Kurdish militia who are resisting the seizure of their city by Islamic State militants. The Turkish government, however, has criticized the operation. VOA’s Scott Bobb reports from southeastern Turkey, across the border from Kobani.
Video

Video China Political Meeting Seeks to Improve Rule of Law

China’s communist leaders will host a top level political meeting this week, called the Fourth Plenum, and for the first time in the party’s history, rule of law will be a key item on the agenda. Analysts and Chinese media reports say the meetings could see the approval of long-awaited measures aimed at giving courts more independence and include steps to enhance an already aggressive and high-reaching anti-corruption drive. VOA’s Bill Ide has more from Beijing.
Video

Video US ‘Death Cafes’ Put Focus on the Finale

In contemporary America, death usually is a topic to be avoided. But the growing “death café” movement encourages people to discuss their fears and desires about their final moments. VOA’s Jerome Socolovsky reports.
Video

Video Ebola Orphanage Opens in Sierra Leone

Sierra Leone's first Ebola orphanage has opened in the Kailahun district. Hundreds of children orphaned since the beginning of the Ebola outbreak face stigma and rejection with nobody to care for them. Adam Bailes reports for VOA about a new interim care center that's aimed at helping the growing number of children affected by Ebola.
Video

Video Young Nairobi Tech Innovator on 'Track' in Security Business

A 24-year-old technology innovator in Nairobi has invented a tracking device that monitors and secures cars. He has also come up with what he claims is the most robust audio-visual surveillance system yet. As Lenny Ruvaga reports from the Kenyan capital, his innovations are offering alternative security solutions.
Video

Video Latinas Converting to Islam for Identity, Structure

Latinos are one of the fastest growing groups in the Muslim religion. According to the Pew Research Center, about 6 percent of American Muslims are Latino. And a little more than half of new converts are female. VOA’s Carolyn Presutti travelled to Miami, Florida -- where two out of every three residents is Hispanic -- to learn more.
Video

Video Exclusive: American Joins Kurds' Anti-IS Fight

The United States and other Western nations have expressed alarm about their citizens joining Islamic State forces in Syria and Iraq. In a rare counterpoint to the phenomenon, an American has taken up arms with the militants' Syrian Kurdish opponents. Elizabeth Arrott has more in this exclusive profile by VOA Kurdish reporter Zana Omer in Ras al Ayn, Syria.
Video

Video South Korea Confronts Violence Within Military Ranks

Every able-bodied South Korean male between 18 and 35 must serve for 21 to 36 months in the country’s armed forces, depending upon the specific branch. For many, service is a rite of passage to manhood. But there are growing concerns that bullying and violence come along with the tradition. Reporter Jason Strother has more from Seoul.
Video

Video North Carolina Emerges as Key Election Battleground

U.S. congressional midterm elections will be held on November 4th and most political analysts give Republicans an excellent chance to win a majority in the U.S. Senate, which Democrats now control. So what are the issues driving voters in this congressional election year? VOA National Correspondent Jim Malone traveled to North Carolina, one of the most politically competitive states in the country, to find out.
Video

Video Comanche People Maintain Pride in Their Heritage

The Comanche (Indian nation) once were called the “Lords of the Plains,” with an empire that included half the land area of current day Texas, large parts of Oklahoma, New Mexico, Kansas and Colorado.The fierceness and battle prowess of these warriors on horseback delayed the settlement of most of West Texas for four decades. VOA’s Greg Flakus reports from Lawton, Oklahoma, that while their warrior days are over, the 15,000 members of the Comanche Nation remain a proud people.
Video

Video Turkey Campus Attacks Raise Islamic Radicalization Fears

Concerns are growing in Turkey of Islamic radicalization at some universities, after clashes between supporters of the jihadist group Islamic State (IS) or ISIS, and those opposed to the extremists. Pro-jihadist literature is on sale openly on the streets of Istanbul. Critics accuse the government of turning a blind eye to radicalism at home, while Kurds accuse the president of supporting IS - a charge strongly denied. Henry Ridgwell reports from London.

All About America

AppleAndroid