Cyprus has agreed to a ten billion euro ($13bn) deal
with eurozone and IMF leaders to bail out its banks, and to prevent the
Mediterranean island nation from exiting the European single currency.
However, Cypriots can be forgiven for not taking to the streets to wave
flags and honk their car horns. They’re finding out just what the
“protection” afforded by the euro looks like, and it’s more akin to the
kind offered by ski mask-wearing heavies in certain parts of New Jersey
than the financial security Monsieur Trichet promised.
Under the terms of the deal, the country’s second-largest bank will be shut down, and its largest bank will be restructured. Depositors with more than €100,000 ($130,000) in either bank will face losses in the vicinity of 40 percent. In a bid to prevent a run on the island’s other banks and to stop money from fleeing the country, capital controls have been imposed — guaranteeing that there will still be capital flight once the restrictions are lifted.
Read more: http://pjmedia.com/blog/broken-cyprus-bows-to-its-new-eurozone-masters/
Under the terms of the deal, the country’s second-largest bank will be shut down, and its largest bank will be restructured. Depositors with more than €100,000 ($130,000) in either bank will face losses in the vicinity of 40 percent. In a bid to prevent a run on the island’s other banks and to stop money from fleeing the country, capital controls have been imposed — guaranteeing that there will still be capital flight once the restrictions are lifted.
Read more: http://pjmedia.com/blog/broken-cyprus-bows-to-its-new-eurozone-masters/
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