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Some Cyprus Savers Could Lose A Quarter Of Their Bank Deposits In New Deal
Business Insider ^ | 03/23/2013 | Jo Adetunji, The Guardian

Posted on 03/23/2013 8:03:39 AM PDT by SeekAndFind

Savers in Cyprus could face losing one-quarter of their bank deposits under new proposals being discussed by the government as ministers flew to Brussels to salvage a European bailout.

The new bank levy would only apply to people with more than €100,000 (£85,260) in their accounts, according to the finance minister, Michael Sarris, who also said that significant progress had been made in talks with European officials.

President Nicos Anastasiades travelled to Brussels to work out an alternative plan to raise funds that would allow the country to qualify for an international bailout. Cyprus must raise €5.8bn (£4.9bn) before Monday to qualify for the €10bn EU bailout it needs to prevent the collapse of its banks and a potential departure from the eurozone.

The idea of raising money through a one-off levy on bank deposits was criticised in Cyprus, Russia and elsewhere and was unanimously rejected by the Cypriot parliament earlier this week, but is being reconsidered after negotiations with Russia to find alternative finance did not achieve a result.

On Friday, the Cypriot parliament passed nine bills, including three that would see ailing banks restructured, starting with Laiki, Cyprus's second-largest bank, a "national solidarity fund" and capital controls that would prevent large withdrawals from the country. A decision on the controversial bank savings levy and how it would be applied is due on Saturday.

Other Cypriot politcians discussed a smaller bank levy of 1% which would be aplied to all accounts. The debate is divided between those that want the levy to be borne only by the wealthy which includes a high percentage of Russians who hold €30bn in Cypriot banks.

(Excerpt) Read more at businessinsider.com ...


TOPICS: Business/Economy; Foreign Affairs; Germany; Government; Israel; News/Current Events; Russia; United Kingdom
KEYWORDS: bankrun; cyprus; debt; europeanunion; germany; greece; israel; russia; turkey; unitedkingdom

1 posted on 03/23/2013 8:03:39 AM PDT by SeekAndFind
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To: SeekAndFind

What happened? Did Uncle Billy leave 30 billion Euros in Mr. Potter’s rolled up newspaper?


2 posted on 03/23/2013 8:08:40 AM PDT by Lonesome in Massachussets (What word begins with "O" and ends in economic collapse?)
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To: SeekAndFind

I think we’re witnessing the beginning of the end... And it won’t end well.


3 posted on 03/23/2013 8:10:49 AM PDT by Cowboy Bob (Democrats: Robbing Peter to buy Paul's vote.)
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To: Cowboy Bob
I think we’re witnessing the beginning of the end..

Perhaps, perhaps not. An important part of the article:

The new bank levy would only apply to people with more than €100,000 (£85,260) in their accounts

That means that they have backed off of reneging on federal deposit insurance. Had they given insured accounts a haircut, the entire concept of insured deposits would have become meaningless. Every bank in the world would be susceptible to runs.

4 posted on 03/23/2013 8:21:03 AM PDT by Jeff Chandler (WHAT DIFFERENCE DOES IT MAKE?)
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To: Cowboy Bob

If you were a Russian billionaire keeping two or three billion in a Cyprus bank....you are a loser. You did everything to avoid taxation....to laundry money....and just fly in and avoid all the standard rules that apply to real members of the EU. So time has caught up with you. I don’t see an issue here.

The EU has known for a decade about the abusive habits of the Russian billionaires, and always hinted that it’d have consequences. Well....here we are.


5 posted on 03/23/2013 8:21:32 AM PDT by pepsionice
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To: SeekAndFind

I bet the politicians got their money out two weeks ago.


6 posted on 03/23/2013 8:35:50 AM PDT by aimhigh ( Guns do not kill people. Abortion kills people.)
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To: pepsionice

Class envy, much?

I am astounded by your willingness to sieze someone else’s property.


7 posted on 03/23/2013 8:40:20 AM PDT by patton (“Really? Have you tried chewing cloves?”)
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To: pepsionice

No just Russian billionaires keep money in Cyprus. Many Russians still don’t trust the banks in Russia. There was massive inflation during the 90s. Monthly pension payments were not enough to buy one loaf of bread. When the currency was converted from Soviet money to Russian, there was a limit. A lot of people lost a lot of money.

Then in 1998, Russia defaulted on international loans. Many banks went bankrupt. Many people lost their savings.

In short, Russians who have money don’t trust the Russian banking system and prefer to put it where they believe it’s safe. Cyprus had a reputation for having a safe, stable banking system. Russians want to get as much money out of the country as possible because they are still uncertain of the future here.

Many Russians are also buying property in the West. I know a lot of intelligent, well educated Russians whose goal it is to move to the West, where they perceive life to be better and more stable.


8 posted on 03/23/2013 8:40:34 AM PDT by Cowboy Bob (Democrats: Robbing Peter to buy Paul's vote.)
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To: Jeff Chandler

Once deposits are allowed to be stolen by the govt, banks will no longer be viewed as safe. People will not keep money there and the banks will go away.


9 posted on 03/23/2013 8:54:10 AM PDT by logic101.net (How many more children must die on the alter of "gun free zones"?)
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To: SeekAndFind

The Russian Mafia guy’s aren’t going to like this.....


10 posted on 03/23/2013 8:56:39 AM PDT by nevergore ("It could be that the purpose of my life is simply to serve as a warning to others.")
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To: logic101.net

They have been talking about this for about two weeks. If I lived there every penny I had would be taken out of the bank and I’d convert it to metals. We’ve always been told that part of what caused the depression was people in a panic, removing their money from the banks. Funny the stock market had had hit new highs right about that time too.


11 posted on 03/23/2013 9:01:42 AM PDT by Ab Alius Domitor ("In the end; the winner")
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To: SeekAndFind

How is this not grand larceny, a felony theft? How is government above and beyond the law? How does law not apply to government?

Ah, yes - the very same thing is here and now with the Obama administration....


12 posted on 03/23/2013 9:18:09 AM PDT by Arlis (.)
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To: SeekAndFind

I would have a serious talk with my banker where I tell him I had a contract with him and his bank. I put $X in and I expect $X out. If he only gives me $Y I would ask him how much of his bank did he think $X-Y was worth, because I don’t want to burn down or blow up any more than he owes me.....


13 posted on 03/23/2013 9:25:25 AM PDT by Feckless (I was trained by the US << This Tagline Censored by FR >> ain't that irOnic?)
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To: SeekAndFind

If you invest your money, and the investment says that your first 100,000 is insured, you should assume the rest could be lost, and ask for interest to be paid according to that risk.

And given that these banks have been paying 7% interest, the depositors have been well-compensated for their risk up until now.

Which of us wouldn’t kill for a 7% return on our FDIC-insured deposits.


14 posted on 03/23/2013 10:03:00 AM PDT by CharlesWayneCT
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To: SeekAndFind
The new bank levy would only apply to people with more than €100,000 (£85,260) in their accounts,

Ha...ha....good luck with that..,.

the collapse will be faster and deeper.

next up ...bank safety deposit boxes.

15 posted on 03/23/2013 10:21:11 AM PDT by spokeshave (The only people better off today than 4 years ago are the Prisoners at Guantanamo.)
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To: spokeshave

What else is ludicrous is the advice to put your money in precious metals——if you don’t have actual physical possession of those metals.

ANYTHING stored in someone else’s bank or business vault can be taken from you before you even know.Sotrusting “your gold” is safe because end-times preacher and shill for a gold company promises to keep it safe is no different than having a bank.

WE trust the banks and government not to steal despite the evidence they both will IF they can get away with it!


16 posted on 03/23/2013 10:39:35 AM PDT by hoosierham (Freedom isn't free)
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To: patton

I wouldn’t have phrased it like the other poster but the fact is not bailing out Russian billionaires came into the conversation early and was the reason for the initial plan.
The way this is shaking out i would not be surprised if it was Putin’s idea to hurt them this way which he communicated to Merkel. He’s been looking for ways to get them to keep their money in Russia. I would not put this past him.


17 posted on 03/23/2013 11:56:50 AM PDT by wiggen (The teacher card. When the racism card just won't work.)
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To: spokeshave

They want to control outflows of cash as well. Restrict cash from leaving Cyprus. Of course in 6-12 months everyone will have taken their money out and boom no more banking business.


18 posted on 03/23/2013 11:58:12 AM PDT by wiggen (The teacher card. When the racism card just won't work.)
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To: SeekAndFind

The haircut has been lowered to a frontal lobotomy.


19 posted on 03/23/2013 11:59:44 AM PDT by SgtHooper (The last thing I want to do is hurt you. But it's still on the list.)
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To: Ab Alius Domitor

Once the topic was put out there the banks had closed for business that day. They have yet to reopen. You’d be taking whatever you were allowed via ATM and nothing else.


20 posted on 03/23/2013 11:59:50 AM PDT by wiggen (The teacher card. When the racism card just won't work.)
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To: wiggen

“not bailing out Russian billionaires “

Letting someone keep their own money is only a bailout to a democrat. You know, they believe all money belongs to them, they are bailing you out by letting you keep some...

And, it is a straw man - $100 k may seem like a lot of money, but many farmers and the like keep that much in the bank as a matter of course - they need it for operating costs.

Are they russian billionairs?


21 posted on 03/23/2013 12:37:24 PM PDT by patton (“Really? Have you tried chewing cloves?”)
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To: SgtHooper

‘The haircut has been lowered to a frontal lobotomy.”

That’s the funniest comment on banking that I’ve seen.

LOL!


22 posted on 03/23/2013 3:51:35 PM PDT by sergeantdave
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To: Cowboy Bob

Thanks. I’ve been getting the feeling that we’re being manipulated (again) by the media. The Russians have EVERY REASON not to trust their own banks, given their recent history. As to whether there are crooks putting money into Cypress...probably, as to whether honest Russians are doing the same...definitely. So, what did they do wrong?


23 posted on 03/23/2013 4:20:56 PM PDT by BobL (Look up "CSCOPE" if you want to see something really scary)
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