Skip to comments.LIVE: Deal Reached On Cyprus Bailout
Posted on 03/24/2013 7:11:45 PM PDT by blam
LIVE: Deal Reached On Cyprus Bailout
March 24, 2013
The Eurogroup of euro zone finance ministers met in Brussels tonight to approve a plan to bail out the Cypriot banking system.
The new deal will see uninsured deposits at the country's two largest banks take a substantial haircut, but insured depositors those with less than 100,000 euros in their bank accounts will be spared from the one-off "tax" that was being considered just a week ago.
Reports of a deal between Cypriot and EU officials being reached prior to the Eurogroup meeting caused the euro and the Australian stock market to spike.
Now, the Eurogroup has signed off on the deal as well.
CNBC's Kelly Evans tweets that Cypriot President Nicos Anastasiades is pleased with the outcome:
Below are more details from Reuters on the plan:
It will mean that Popular Bank of Cyprus, the island's second largest bank which is also known as Laiki, will effectively be shut down.
Deposits below 100,000 euros in Laiki will be transferred to Bank of Cyprus, the country's largest bank. Deposits above 100,000 euros, which under EU law are not insured, will be frozen and will be used to resolve debts. It remains unclear how large the writedown on those funds will be.
No charges will be incurred against any Cypriot bank account with less than 100,000 euros in them, the officials said.
Because the process will be treated as a bank restructuring as opposed to a nationwide "tax" on bank deposits, it seems that the plan will not be subjected to another vote in the Cypriot parliament, which on Friday passed new laws enabling them to navigate the restructuring process more easily.
The Eurogroup press conference is now underway.
Dutch Finance Minister Jeroen Dijsselbloem,
(Excerpt) Read more at businessinsider.com ...
What a relief! /s
Ivan gets scalped.
Assuming the Russian 31 billion isn’t insured.
is that you rachel corrie?????
I know *I* have dozens of accounts to keep just under 100K in each of them for trying times such as this.
Ivan won't forget.
Next stop: USA
THe EU may be stupid and destroying European civilization, but they sure know how to cling on to power and never let go.
Wow, that’s a relief. I thought they were going to do something crooked to steal depositor’s money. Just a little ole “government managed” bankruptcy....where have I heard that term before?
Glory to the Belgian Bolshevik’s and the new revolution!
How much will prices spike now as investors take the money they have and purchase commodities to protect against seizures else where?
I’ve heard between 25 - 40 percent. There’s also a rumor that the Cypriot Parliament might not vote on it since it’s a “restructuring” and not a tax.
Whole lot of EU officials need to buy a Geiger counter.
Any bets on how long before the first killing by the Russians?A bunch of people signed their own death warrants when they stole from former KGB types.
Cypriots have a hugh sigh of relief, as their bank accounts remain intact, while the same effect is achieved in a slightly different, but less noticeable way. You know, like has been happening, and is happening right now in the US.
Jeb Bush. Ima sure it was Jeb.
Whole lot of EU officials will have to hire someone to start their car for them.
A “haircut”, really? Um no, it is confiscation. And it’s outrageous.
So it would be better if the entire country collapsed and people started slaughtering each other in the streets?
This is a watershed event for Capitalism, Worldwide.
IMHO, it signals that THE STATE has finally grown to be TO BIG TO FAIL, and thus must cannibalize all who have what THE STATE wants.
Profit and loss be damned, THE STATE must not fail! Heil! Heil! Heil!
“Deposits above 100,000 euros...will be frozen and will be used to resolve debts.”
People who have over 100,000 in cash accounts are people with a proven ability to make things happen in their favor. Unwise to piss such people off.
Heh, just like Cryboehnor, kicking the can down the road.
Steal funds from someone else, delay responsibility, make bad decisions and won’t accept the responsibility for ruining things in the first place.
Especially Russian billionaires.
In the US the FDIC says deposits insured up to E100,000. This seems to imply that if you were foolish enough to save up E105,000, that now all of your money goes to the bad bank to be lost forever with all of the big foreign money they're looting?
Read another thread with an article yesterday. Person said the ‘rich’ would pay. Looks correct from here. We wonder why Russia will come down from the north according to scripture.
Ivan getting scalpeled will definitely cause some major Bolshevik Blowback!
“Ive heard between 25 - 40 percent.”
If that’s the case, I expect there will be many companies that can’t meet their payrolls or pay vendors. Then what? I haven’t heard whether bondholders will be getting a haircut.
How much money do you think the Eurocrats stole from Pootie-Poot Putin?
I’ll see if I can find out about the bondholders.
Common tactic. Float a deal that raises an uproar, then everyone settles for something merely outrageous.
It’s theft, pure and simple.
1. Laiki will be resolved immediately - with full contribution of equity shareholders, bond holders and uninsured depositors - based on a decision by the Central Bank of Cyprus, using the newly adopted Bank Resolution Framework.
2. Laiki will be split into a good bank and a bad bank. The bad bank will be run down over time.
3. The good bank will be folded into Bank of Cyprus (BoC), using the Bank Resolution Framework,after having heard the Boards of Directors of BoC a nd Laiki. It will take 9 bn Euros of ELA with it. Only uninsured deposits in BoC will remain frozen until recapitalisation has been effected, and may subsequently be subject to appropriate conditions.
4. The Governing Council of the ECB will provide liquidity to the BoC in line with applicable rules.
5. BoC will be recapitalised through a deposit/equity conversion of uninsured deposits with fullcontribution of equity shareholders and bond holders.
6. The conversion will be such that a capital ratio of 9 % is secured by the end of the programme.
7. All insured depositors in all banks will be full y protected in accordance with the relevant EU legislation.
8. The programme money (up to 10bn Euros) will not be used to recapitalise Laiki and Bank of Cyprus.
The European Union - the New Soviet Union?
The price of natural gas will go up a little for Europe, all will be well...
And I will say this, unlike the EU, Russia won’t impose acceptance of faggotry on their subjects.
A good question ... And note this news item.
Berezovsky, a Russian oligarch and long-time critic of Russian President Vladimir Putin, was found dead at his home near Ascot, a well-heeled commuter town near London, on Saturday afternoon.
Read more: http://www.smh.com.au/world/radiation-experts-join-berezovsky-probe-20130324-2gnix.html#ixzz2OW51FvZF
I expect to see the stock market go up furiously tomorrow with the good news of yet another government bailed out with worthless money. Yippee!! I’m sure the MSM will be having more Obamagasms over this news, even though he had nothing to do with it.
It’s really horrible. Banks have absolutely no ownership interest in their depositor’s money. To the extent that deposits are insured, the insurer would pay the banks and then go after the banks in subrogation. As to uninsured amounts, the depositor would proceed directly against the banks to collect. But under no circumstances does a bank have the right to simply take the property of another - i.e. the depositors - and use it to write down other debts it owes to other parties, including regulators. This is really the most lawless thing imaginable. They might as well have gone to every Cypriot who owns a car and taken their vehicle and sold it at auction and pocketed the money. It’s exactly the same thing - theft. This is larceny pure and simple.
25-40% isn’t a restructuring, haircut, fleecing or scalping; that’s rape and pillage.
Anyone with money needs to put a good percent of their wealth into hard assets. Land (waterfront lots, farmland), gold/silver etc. REIT's are also a good place to be. You need some cash but you need to look average to almost poor. Hide your wealth. That's the great lesson here.
“Person said the rich would pay. Looks correct from here.”
Except for those privileged ‘rich’ insiders connected to the ECB who somehow managed to transfer their funds ahead of their accounts being frozen, no doubt.
I also think there will still be a run on the banks for those under 100K euros.
Think of the example this sets. If I was rich in another EU country, my money is gone tomorrow.
My viking blood is starting to tingle.
“Because the process will be treated as a bank restructuring as opposed to a nationwide “tax” on bank deposits, it seems that the plan will not be subjected to another vote in the Cypriot parliament”
That’s because ones and zeros on spinning hard drives are even more fungible than physical money. In fact, spinning ones and zeros are about as fungible as something can get.
Yes, but it’s even worse than that. No property right is safe in EU now. They can simply confiscate your property without recourse. No due process of law. This will come to be seen as a watershed event.
Might not be a sure safe haven. They were already considering seizing real estate of foreigners. In fact, waterfront lots on the Mediterranean.
True, and by un-elected bureaucrats from another country. I concur with your last sentence completely.
Their political thieves are not as creative as ours. All they need to do is say you have to vote on the bill to find out what is in the bill.