Early today it was confirmed that Cyprus has secured a bailout package that will protect all deposits that are under EUR 100,000.
Looks like Cyprus has avoided bankruptcy as Eurozone Finance Ministers have secured EUR 10 billion bailout, which subsequently will prevent Cyprus banking systems collapse and maintain the country EU member state!
According to media the island`s second largest bank LAIKI will be facing severe loses, and all uninsured deposits over EUR 100,000 will be raided and expectedly will raise EUR 4.2 billion. And all deposits over EUR 100,000, that are not guaranteed under EU law, will be frozen and used towards resolving debts of LAIKI as well to recapitalize Bank of Cyprus through a deposit/equity conversion.
The Island is to face a deep recession, many businesses will shut which will be followed by a high unemployment and it is uncertain when will the country’s economic growth return. Cyprus is in for a fight to get back on its feet!
One of top EU Commission`s economic official Olli Rehn said: "The near future will be very difficult for the country and its people,"... "But (the measures) will be necessary for the Cypriot people to rebuild their economy on a new basis."
Banks in Cyprus have been closed and are due to reopen on Tuesday, as officials worked on the rescue plan. ATM`s have been a source of cash withdrawals, but obviously they have run out of cash pretty fast.
Today Russian president Vladimir Putin instructed his government to work towards restructuring of the EUR 2,5 billion loan to Cyprus.
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