Sat Mar 23, 2024 11:33 pm by globalturbo
Nightmare unfolding in Cyprus, as plan hatched to seize 25% of large bank deposits
Posted on March 23, 2013 by The Extinction Protocol
March 23, 2013 – CYPRUS - Cyprus
said on Saturday it was looking at seizing a quarter of the value of
big deposits at its largest bank, as it races to raise the funds for a
bailout from the European Union and to avert financial collapse. Finance
Minister Michael Sarris said “significant progress” had been made in
talks in Nicosia with officials from the European Union, European
Central Bank and International Monetary Fund. He confirmed discussions
were centered on a possible levy of around 25 percent on holdings of
over 100,000 euros (about $130,000) at Bank of Cyprus, and expressed
hope that a package could be ready by the end of the day for approval by
parliament. Cyprus faces a Monday deadline to clinch a bailout deal
with the EU or the European Central Bank says it will cut off emergency
cash to the island’s over-sized and stricken banks, spelling certain
collapse and a potential exit from Europe’s single currency. Amid signs
of momentum, Cypriot and EU officials said Cypriot President Nicos
Anastasiades was expected in Brussels on Sunday to meet EU leaders
including Council President Herman Van Rompuy and Commission President
Jose-Manuel Barroso, as well as IMF Managing Director Christine Lagarde
and the head of the ECB, Mario Draghi. Protesters in Cyprus gather
outside parliament as government officials try to strike a bailout deal
with the European Union. NBCNews.com’s Dara Brown reports. Van Rompuy
and Barroso canceled a planned EU-Japan summit in Tokyo to tend to the
Cyprus saga and euro zone officials told Reuters that the
bloc’s 17 finance ministers would meet on Sunday afternoon. “Significant
progress has been made in the direction of getting a deal, at least at
the troika level,” Sarris told reporters. He said a number of issues
were still outstanding, but that a package could be ready “late this
afternoon or early evening” for approval by parliament. Arriving at the
troika talks, Andreas Artemi, chairman of Bank of Cyprus, was asked if a
25 percent haircut was being considered on uninsured deposits. He
replied: “I don’t know that yet.”
A senior lawmaker told Reuters
earlier on Saturday that parliament was not expected to convene until
after the meeting of euro zone finance ministers on Sunday afternoon,
taking the crisis right down to the wire. The same legislature on
Tuesday angrily threw out a proposed levy on bank deposits, designed to
raise the 5.8 billion euros the EU wants in return for a 10 billion euro
($13 billion) bailout. The tax is unprecedented in Europe’s handling of
a debt crisis that has spread from Greece, to Ireland, Portugal, Spain
and Italy. It is by no means certain the tiny legislature will accept
the measure this time around. The turnaround came after Russia rebuffed
Cypriot entreaties to help its banks, where Russian citizens and other
foreigners have billions of euros at stake. Significantly, the latest
proposal would spare small depositors, who were outraged by the original
plan to hit small holdings as well as large accounts, many of them held
by rich foreigners including Russians. Cypriot leaders fear the damage
the levy would do to the country’s offshore banking industry. The
tottering banks hold 68 billion euros ($88 billion) in deposits,
including 38 billion ($49 billion) in accounts of more than 100,000
euros – enormous sums for an island of 1.1 million people which could
never sustain such a big financial system on its own. But much of the
banks’ capital was wiped out by investments in Greece, the epicenter of
the euro zone debt crisis. Racing to placate its European partners,
Cypriot lawmakers voted in late-night session on Friday to nationalize
state pensions and split failing lenders into good and bad banks. They
also gave the government powers to impose capital controls on banks,
anticipating a flood of money from the island when banks are due to
reopen on Tuesday after more than a week of lockdown. The plan to
nationalize semi-state pension funds has, however, met with resistance,
particularly from Germany which made clear that tapping pensions could
be even more painful for ordinary Cypriots than a deposit levy. The pace
of the unfolding drama has stunned Cypriots, who have besieged bank
cash machines since the levy was first mooted a week ago. “Our so-called
friends and partners sold us out,” said Marios Panayides, 65, a
protester at the parliament. “They have completely abandoned us on the
edge of an abyss.” –MSNBC
Thanks to: http://theextinctionprotocol.wordpress.com
Posted on March 23, 2013 by The Extinction Protocol
March 23, 2013 – CYPRUS - Cyprus
said on Saturday it was looking at seizing a quarter of the value of
big deposits at its largest bank, as it races to raise the funds for a
bailout from the European Union and to avert financial collapse. Finance
Minister Michael Sarris said “significant progress” had been made in
talks in Nicosia with officials from the European Union, European
Central Bank and International Monetary Fund. He confirmed discussions
were centered on a possible levy of around 25 percent on holdings of
over 100,000 euros (about $130,000) at Bank of Cyprus, and expressed
hope that a package could be ready by the end of the day for approval by
parliament. Cyprus faces a Monday deadline to clinch a bailout deal
with the EU or the European Central Bank says it will cut off emergency
cash to the island’s over-sized and stricken banks, spelling certain
collapse and a potential exit from Europe’s single currency. Amid signs
of momentum, Cypriot and EU officials said Cypriot President Nicos
Anastasiades was expected in Brussels on Sunday to meet EU leaders
including Council President Herman Van Rompuy and Commission President
Jose-Manuel Barroso, as well as IMF Managing Director Christine Lagarde
and the head of the ECB, Mario Draghi. Protesters in Cyprus gather
outside parliament as government officials try to strike a bailout deal
with the European Union. NBCNews.com’s Dara Brown reports. Van Rompuy
and Barroso canceled a planned EU-Japan summit in Tokyo to tend to the
Cyprus saga and euro zone officials told Reuters that the
bloc’s 17 finance ministers would meet on Sunday afternoon. “Significant
progress has been made in the direction of getting a deal, at least at
the troika level,” Sarris told reporters. He said a number of issues
were still outstanding, but that a package could be ready “late this
afternoon or early evening” for approval by parliament. Arriving at the
troika talks, Andreas Artemi, chairman of Bank of Cyprus, was asked if a
25 percent haircut was being considered on uninsured deposits. He
replied: “I don’t know that yet.”
earlier on Saturday that parliament was not expected to convene until
after the meeting of euro zone finance ministers on Sunday afternoon,
taking the crisis right down to the wire. The same legislature on
Tuesday angrily threw out a proposed levy on bank deposits, designed to
raise the 5.8 billion euros the EU wants in return for a 10 billion euro
($13 billion) bailout. The tax is unprecedented in Europe’s handling of
a debt crisis that has spread from Greece, to Ireland, Portugal, Spain
and Italy. It is by no means certain the tiny legislature will accept
the measure this time around. The turnaround came after Russia rebuffed
Cypriot entreaties to help its banks, where Russian citizens and other
foreigners have billions of euros at stake. Significantly, the latest
proposal would spare small depositors, who were outraged by the original
plan to hit small holdings as well as large accounts, many of them held
by rich foreigners including Russians. Cypriot leaders fear the damage
the levy would do to the country’s offshore banking industry. The
tottering banks hold 68 billion euros ($88 billion) in deposits,
including 38 billion ($49 billion) in accounts of more than 100,000
euros – enormous sums for an island of 1.1 million people which could
never sustain such a big financial system on its own. But much of the
banks’ capital was wiped out by investments in Greece, the epicenter of
the euro zone debt crisis. Racing to placate its European partners,
Cypriot lawmakers voted in late-night session on Friday to nationalize
state pensions and split failing lenders into good and bad banks. They
also gave the government powers to impose capital controls on banks,
anticipating a flood of money from the island when banks are due to
reopen on Tuesday after more than a week of lockdown. The plan to
nationalize semi-state pension funds has, however, met with resistance,
particularly from Germany which made clear that tapping pensions could
be even more painful for ordinary Cypriots than a deposit levy. The pace
of the unfolding drama has stunned Cypriots, who have besieged bank
cash machines since the levy was first mooted a week ago. “Our so-called
friends and partners sold us out,” said Marios Panayides, 65, a
protester at the parliament. “They have completely abandoned us on the
edge of an abyss.” –MSNBC
Thanks to: http://theextinctionprotocol.wordpress.com
