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

Video Falling Gas Prices Impact US Oil Extraction

With the price of oil now less than $80 a barrel, motorists throughout the US are seeing gas prices dip below $3 a gallon More

Afghan Women's Soccer Team Building for the Future

A four-team female league was recently set up in Kabul; It will help identify players for the national team More

Video Koreas on Edge Amid Live-fire Drills

Pyongyang threatens nuclear test as joint US, S. Korean exercises show forces’ capabilities 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.
New Skateboard Defies Gravityi
X
November 21, 2014 5:07 AM
A futuristic dream only a couple of decades ago, the hoverboard – a skateboard that floats above the ground - has finally been made possible. While still not ready for mass production, it promises to become a cool mode of transport... at least over some surfaces. VOA’s George Putic reports.
Video

Video New Skateboard Defies Gravity

A futuristic dream only a couple of decades ago, the hoverboard – a skateboard that floats above the ground - has finally been made possible. While still not ready for mass production, it promises to become a cool mode of transport... at least over some surfaces. VOA’s George Putic reports.
Video

Video Falling Gas Prices Impact US Oil Extraction

With the price of oil now less than $80 a barrel, motorists throughout the United States are benefiting from gas prices below $3 a gallon. But as VOA’s Kane Farabaugh reports, the decreasing price of petroleum has a downside for the hydraulic fracturing industry in the United States.
Video

Video Tensions Build on Korean Peninsula Amid Military Drills

It has been another tense week on the Korean peninsula as Pyongyang threatened to again test nuclear weapons while the U.S. and South Korean forces held joint military exercises in a show of force. VOA’s Brian Padden reports from the Kunsan Air Base in South Korea.
Video

Video Mama Sarah Obama Honored at UN Women’s Entrepreneurship Day

President Barack Obama's step-grandmother is in the United States to raise money to build a $12 million school and hospital center in Kogelo, Kenya, the birthplace of the president's father, Barack Obama, Sr. She was honored for her decades of work to aid poor Kenyans at a Women's Entrepreneurship Day at the United Nations.
Video

Video Gay Evangelicals Argue That Bible Does Not Condemn Homosexuality

More than 30 U.S. states now recognize same-sex marriages, and an increasing number of mainline American churches are blessing them. But evangelical church members- which account for around 30 percent of the U.S. adult population - believe the Bible unequivocally condemns homosexuality. VOA's Jerome Socolovsky reports that gay, lesbian, bisexual and transgender evangelicals are coming out. Backed by a prominent evangelical scholar, they argue that the traditional reading of the bible is wrong.
Video

Video Ebola Economic Toll Stirs W. Africa Food Security Concerns

The World Bank said Wednesday that it expects the economic impact of the Ebola outbreak on the sub-Saharan economy to cost somewhere betweenf $3 billion to $4 billion - well below a previously-outlined worst-case scenario of $32 billion. Some economists, however, paint a gloomier picture - warning that the disruption to regional markets and trading is considerable. Henry Ridgwell reports from London.
Video

Video Mexico Protests Escalate Over Disappearances

Protests in Mexico over 43 students missing since September continue to escalate, reflecting growing anger among Mexicans about a political system they view as corrupt, and increasingly tainted by the drug trade. Mounting outrage over the disappearances is now focused on the government of President Enrique Pena Nieto, accused of not doing enough to end insecurity in the country. More from VOA's Victoria Macchi.
Video

Video US Senate Votes Down Controversial Oil Pipeline - For Now

The U.S. Senate has rejected construction of a controversial pipeline to transport Canadian oil to American refineries. The $5 billion project still could be approved next year, but it faces a possible veto by President Barack Obama. As VOA’s Michael Bowman reports, the pipeline has exposed deep divisions in Congress about America’s energy future.
Video

Video Can Minsk Cease-fire Agreement Hold?

Growing tensions between government troops and separatists in eastern Ukraine further threaten a cease-fire agreement reached two months ago in the Belarusian capital of Minsk. Critics of U.S. policy in Ukraine say it is time the Obama administration gives up on that much-violated cease-fire and moves toward a new deal with Russia. VOA's Scott Stearns has more.
Video

Video Chaos, Abuse Defy Solution in Libya

The political and security crisis in Libya is deepening, with competing governments and, according to Amnesty International, widespread human rights violations committed with impunity. VOA’s Al Pessin reports from London.
Video

Video US Hosts Record 866,000 Foreign Students

Close to 900,000 international students are studying at American universities and colleges, more than ever before. About half of them come from Asia, mostly China. The United States hosts more foreign students than any other country in the world, and its foreign student population is steadily growing. Zlatica Hoke reports.
Video

Video Ferguson Church Grapples with Race Relations

Many white residents of Ferguson, Missouri, say they chose to live there because of the American Midwest community's diversity. So, they were shocked when a white police officer killed an unarmed black teenager in August – and shaken by the resulting protests and violence. Some local churches are leading conversations on how to go forward. VOA’s Ayesha Tanzeem reports.

All About America

AppleAndroid