Mobile version
Original Original Original

Cyprus Bank Bailout Review Delayed

W460

The Cyprus Central Bank said on Saturday that a study into how much the country's Greek-exposed banking system needs as part of an EU bailout package has yet to be finalized.

The bank said in a statement that the due diligence review of the banking system -- expected to be completed on January 18 -- was not yet finalized.

"An examination of the technical details of the calculation of capital requirements for financial institutions in Cyprus is still under way," it said.

"Once this process is complete we will issue an announcement."

Without a figure for bank recapitalization -- the lion's share of an EU bailout -- there can be no agreement on a final loan deal for Cyprus.

Nicosia applied for EU financial aid in June when its two largest banks asked for financial assistance, but agreement on the terms of the deal have dragged on.

Eurozone finance ministers will meet on Monday to discuss the bailout terms, but no final decision is now likely without a firm figure for bank recapitalization.

In a draft agreement with the troika of international lenders the amount for the banks was set at up to 10 billion euros as part of a total package which could reach 17.5 billion euros -- matching the island's entire economy.

Although Cyprus has pushed through harsh austerity measures of around 1.2 billion euros in tax hikes and savings, fellow EU partners have called for more reforms.

Nicosia says it has done everything asked of it under the preliminary agreement with the troika -- the European Commission, European Central Bank and the International Monetary Fund.

"Cyprus is a reliable partner that honors what it has agreed and is committed to," President Demetris Christofias told reporters on Saturday.

Comments 0