News / Europe

Cyprus Banks to Remain Closed Until Thursday

A trader looks at his screen on the IG Group trading floor in London March 18, 2013. The surprise decision by eurozone leaders to partially fund a bailout of Cyprus by taxing bank deposits sent shockwaves through financial markets on Monday.
A trader looks at his screen on the IG Group trading floor in London March 18, 2013. The surprise decision by eurozone leaders to partially fund a bailout of Cyprus by taxing bank deposits sent shockwaves through financial markets on Monday.
VOA News
Cyprus banks will remain closed until Thursday to prevent a run on accounts as the Mediterranean island nation considers imposing a first-ever bank deposit tax.

The proposed bank levy has rattled investors. Stock markets throughout the world dropped Monday in the aftermath of the bailout for tiny Cyprus. Stocks in Asia plunged two percent or more, with European and U.S. indexes falling by smaller amounts.

The proposed bank tax would hit everyone with money in Cypriot banks, including foreign nationals.

Cyprus moved to revamp terms of the bank deposit tax imposed by its international lenders as part of a $13 billion bailout to keep from going bankrupt.

Cypriot officials were working with the lenders to cut or eliminate the tax on small investors, while raising it on those with bigger accounts. For the second day in a row, Cyprus's parliament postponed a vote on a new plan and rescheduled it for Tuesday.

  • Bank of Cyprus employees sit in front of riot police during a protest outside Greece's Finance Ministry as the bank remains closed for third day in central Athens, March 21, 2013.
  • People line up at an ATM outside a closed Laiki Bank branch in Nicosia, Cyprus, March 21, 2013.
  • Employees of the Bank of Cyprus take part in a rally in solidarity with Cyprus outside the headquarters of the bank in Athens, Greece, March 20, 2013.
  • International Monetary Fund mission chief Delia Velculescu arrives for a meeting with Cypriot President Nicos Anastasiades at the presidential palace in Nicosia, Cyprus, March 20, 2013.
  • A man walks by graffiti that reads "Troika out" in the old city of capital Nicosia, Cyprus, March 19, 2013.
  • Demonstrators raise their arms in protest as Cypriot President Nicos Anastasiades's convoy drives to the parliament in Nicosia, Cyprus, March 18, 2013.
  • A protester shouts slogans outside of parliament during a meeting in Nicosia, Cyprus, March 18, 2013.
  • Cypriot President Nicos Anastasiades arrives at parliament in Nicosia, Cyprus, March 18, 2013.

Cypriot banks were closed on Monday for a holiday.

Cypriots were angered by the deposit tax, with one domestic worker saying it is unacceptable.

"We cleaning ladies spend our entire days trying to earn some money in order to feed our children, and now they are saying they are going to take it from us?" one woman said.  "It's unacceptable. No. Not a single haircut, we will not accept any kind of haircut.''

Under bailout terms set Saturday by Cyprus's eurozone neighbors and the International Monetary Fund, a one-time tax of 9.9 percent would be imposed on deposits of $131,000 and up, while deposits under $131,000 would be taxed at 6.75 percent.

Analyst Robert Halver of the Baader Bank said the fear is that depositors throughout the eurozone might view the Cyprus experience as reason to start withdrawing their funds from bank accounts. Such a run on banks could create a new crisis for European governments, now in the third year of their debt crisis.

"What has been done in Cyprus is an experiment," Halver said. "If the population has to, in the form of their savings, contribute to rectify the mistakes that have been made in Cyprus, then there is a danger that in other countries people will decide, at the breakfast table, to withdraw their money. If money is withdrawn on a great scale, if we have a bank run, then we see the return of the bank crisis."

Russian President Vladimir Putin on Monday called the proposed levy "unfair, unprofessional and dangerous."  Russian banks and corporations have billions of dollars in Cypriot banks.

Cypriot media say it is unlikely lawmakers will agree to the terms set in the bailout.  

President Nicos Anastasiades said in a televised address to the nation Sunday if parliament does not approve the levy, Cyprus faces bankruptcy and the possible exit of Cyprus from the eurozone.


Watch related video

Related Video of Cyprus Situationi
X
March 18, 2013 3:23 PM
Residents of Cyprus are angry that their bank deposits are subject to a one-time tax levy as part of a bailout deal for the cash-strapped island. Eurozone finance ministers and the International Monetary Fund included the levy as part of a deal to give Cyprus $13 billion to avoid bankruptcy. News of the tax plan sent stocks tumbling Monday in Asia.

You May Like

Analysis: China Raises Hong Kong Rhetoric to Tiananmen Level

A front-page commentary in The People’s Daily called the current demonstrations 'chaos,' the same word Party officials used 25 years ago to describe the Tiananmen Square protests More

US Airstrikes Anger Syrian Civilians Fleeing Their Homes

Pentagon officials say they have seen no credible evidence of civilian deaths caused by US airstrikes against Islamic State militants More

Child Sexual Exploitation to Worsen in SE Asia

Southeast Asia’s planned economic integration is a key step for boosting the region’s productivity, but carries downsides as well More

This forum has been closed.
Comment Sorting
Comments
     
by: DAVID LULASA from: tambua,gimarakwa,hamisi,v
March 19, 2013 6:29 AM
cyprus government should not lose hope even when they havent used the money and see if there are no profits to be realised from the loan...i wonder who has told them that they wont make a profit and hence the need for cypriots account holders to pay for the loan?.

lulasa...president


by: NVO from: USA
March 18, 2013 7:34 PM
The Global Elites plan of the NEW WORLD ORDER is to make you become CONDITIONED to their EVIL plan.............A ONE WORLD GOVERNMENT, RIGGED MARKETS, MICROCHIPPING OF CITIZENS, EUGENICS and WAR. The Bilderberg group headed by the ROCKEFELLERS and the ROTHSCHILDS are the ones to EXPOSE! “The process in which the frequency or predictability of a behavioral response is increased through reinforcement (i.e., a stimulus or a reward for the desired response). Classical, or respondent, conditioning, which involves stimulus substitution, is based on the work of Ivan Pavlov, who conditioned dogs by ringing a bell each time the aroma of food was presented. Eventually the dogs salivated when the bell rang, even if no food odor was present; salivation was thus the conditioned response.”

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
The Legacy of Jimmy Carter: The Preacher from Plainsi
X
October 01, 2014 10:45 AM
It is common in the United States to see tourists flock to sites associated with America's presidents. Some are privately owned and others are run by the National Park Service or the National Archives -- but most have helped draw business and people into the towns and cities where they are located. As VOA’s Kane Farabaugh reports, there is one particular presidential hometown that is unique in what it has to offer those who make the trip.
Video

Video The Legacy of Jimmy Carter: The Preacher from Plains

It is common in the United States to see tourists flock to sites associated with America's presidents. Some are privately owned and others are run by the National Park Service or the National Archives -- but most have helped draw business and people into the towns and cities where they are located. As VOA’s Kane Farabaugh reports, there is one particular presidential hometown that is unique in what it has to offer those who make the trip.
Video

Video Hong Kong Protests Draw New Supporters on National Holiday

On the 65th anniversary of the founding of Communist China, Hong Kong protesters are hoping to stage the largest pro-democracy demonstration since the 1989 Tiananmen protests. VOA's Brian Padden visited one of the protest sites mid-day, when the atmosphere was calm and where the supporters were enthusiastic about joining what they are calling the umbrella revolution.
Video

Video India's PM Continues First US Visit

India's prime minister is on his first visit to Washington, to strengthen political and economic ties between the world's oldest and the world biggest democracies. He came to the U.S. capital from New York, the first stop on his five-day visit to the country that denied him an entry visa in the past. From Washington, Zlatica Hoke reports Modi seemed most focused on attracting foreign investment and trade to increase job opportunities for his people.
Video

Video Malaysia Struggles to Stop People Joining Jihad

Malaysian authorities say militant groups like the so-called "Islamic State" have used social media to entice at least three dozen Malaysian Muslims to fight in what they call "jihad" in Syria and Iraq. As Mahi Ramkrishnan reports from Kuala Lumpur, counterterrorism police are deeply worried about what could happen when these militants return home.
Video

Video Could US Have Done More to Stop Rise of Islamic State?

President Obama says airstrikes against Islamic State militants in Syria will likely continue for some time because, in his words, "there is a cancer that has grown for too long." So what if President Obama had acted sooner in Syria to arm more-moderate opponents of both the Islamic State and the Syrian government? VOA State Department Correspondent Scott Stearns reports from the United Nations.
Video

Video Treasure Hunters Seek 'Hidden Treasure' in Central Kenya

Could a cave in a small village in central Kenya be the site of buried treasure? A rumor of riches, left behind by colonialists, has some residents dreaming of wealth, while others see it as a dangerous hoax. VOA's Gabe Joselow has the story.
Video

Video Ebola Patients Find No Treatment at Sierra Leone Holding Center

At a holding facility in Makeni, central Sierra Leone, dozens of sick people sit on the floor in an empty university building. They wait in filthy conditions. It's a 16-hour drive by ambulance to Kailahun Ebola treatment center. Adam Bailes was there and reports on what he says are some of the worst situations he has seen since the beginning of this Ebola outbreak. And he says it appears case numbers may already be far worse than authorities acknowledge.
Video

Video Identifying Bodies Found in Texas Border Region

Thousands of immigrants have died after crossing the border from Mexico into remote areas of the southwestern United States in recent years. Local officials in south Texas alone have found hundreds of unidentified bodies and buried them in mass graves in local cemeteries. Now an anthropologist and her students at Baylor University have been exhuming bodies and looking for clues to identify them. VOA’s Greg Flakus has more from Waco, Texas.
Colonel Steve ‘Spiros’ Pisanos left Greece and came to the U.S. to learn to fly. He flew fighters for the Allies in World War II, narrowly escaping death multiple times.Colonel Steve ‘Spiros’ Pisanos left Greece and came to the U.S. to learn to fly. He flew fighters for the Allies in World War II, narrowly escaping death multiple times.

AppleAndroid