cyprus bailin ensured russians would be bank saviours
Last Updated : GMT 02:06:48
Arab Today, arab today
Arab Today, arab today

Cyprus bail-in ensured Russians would be bank saviours

Arab Today, arab today

Arab Today, arab today Cyprus bail-in ensured Russians would be bank saviours

Nicosia - AFP

Russians now have a say in key lender Bank of Cyprus because of European reluctance to fully bail out Nicosia, fearing that would safeguard oligarchs\' ill-gotten gains, analysts believe. \"Unlike all the other bailout countries the Eurogroup did not want to give Cyprus a full bailout, largely because of media hysteria about alleged money-laundering,\" finance analyst Fiona Mullen told AFP. She said six Russians being appointed to the 16-member board of Bank of Cyprus last week should not surprise anyone because it was a natural consequence of the harsh bailout terms. \"Russians running the biggest bank in Cyprus is a consequence of that (bailout), so the answer to eurozone leaders is \'you get what you pay for,\'\" she said. During its arduous and long drawn-out bailout negotiations with international lenders, Cyprus was portrayed, especially by Germany, as a laundromat for dirty Russian money. Local banks were accused of asking no questions when rich oligarchs wanted to park their cash -- which is why Cypriots suspect international lenders ensured Cyprus was the only eurozone member where uninsured depositors were forced to contribute. Despite vehement government denials, the mud stuck and Cyprus was made to pay dearly for mishandling its economy and allowing a juggernaut banking system to veer off the rails. In return for a 10-billion-euro ($13-billion) bailout secured in March, international creditors demanded the winding up of the country\'s second largest banker Laiki and a haircut on deposits over 100,000 euros in its largest lender Bank of Cyprus (BoC). Ironically, the consequences of the 23-billion-euro bail-in/bailout package has led to the six Russian members of the new BoC board. They were voted in following an historic shareholders\' meeting of those who had received a deposits haircut to help Nicosia secure EU rescue aid. For the first time in its history the island\'s largest financial institution has non-Cypriots managing it -- the same big savers who got burnt when the bloated banking system was saved from collapse. However, the Central Bank of Cyprus must approve the newly elected BoC board members. Cypriot Christis Hassapis, an academic, was voted chairman and Vladimir Strzhalkovskiy became vice chairman. The Russian, reportedly a former KGB official and close friend of President Vladimir Putin, is also former CEO of Norilsk Nickel, the world\'s largest nickel and palladium producer. --- Russians now \'deeper in than ever before\' --- Economy lecturer at Nicosia\'s European University Alexandros Apostolides said if international lenders wanted to nullify the Russian influence in Cyprus they should not have opted for a bail-in. \"Forcing Russian depositors to become shareholders puts them deeper in than ever before -- the only person more tied to a country than a depositor is a shareholder,\" he said. \"The bail-in has locked in the Russians for years to come. If they wanted to punish the Russians by taking their money and putting it into shares you have only managed to make them stay,\" Apostolides added. He argued that having Russians involved is positive because they have an interest in the bank holding their money becoming profitable. The view closer to home is that Russians have saved Cyprus from the abyss by not abandoning it. In an interview with Russia\'s Itar-Tass news agency last week, President Nicos Anastasiades thanked the Russian community for sticking it out. \"Our friends have remained our friends,\" said Anastasiades, also pledging to partly compensate Russian investors who received a severe haircut in the bailout. The BoC board is now tasked with ensuring a rigid restructuring which will see the number of branches and staff drastically The final haircut for uninsured BoC depositors was 48.5 percent, a majority of whom were foreign, most of them Russians who received bank shares in the trade-off. An unprecedented eurozone \"haircut\" on deposits forced the government to close the island\'s banks for nearly two weeks in March and impose draconian controls when they reopened. Cyprus is still the only eurozone member to impose capital controls. The largest BoC shareholders, at 18.1 percent, are depositors in wound-up Laiki, while the next largest are Russian and Ukrainian businessmen with 12-15 percent. BoC\'s share capital is 4.7 billion euros, 81.4 percent of which is owned by 21,000 depositors-turned-shareholders because of the bail-in decision demanded by international lenders. Old shareholders are limited to a 0.5 percent stake. The government concedes that without a healthy Bank of Cyprus the recession-hit economy will struggle to recover. But nobody knows the exact extent of the damage to the BoC as no financial results have been published including year-end 2012 figures. Apostolides said what really matters is keeping the bank afloat. \"We have no idea if the bank can be saved as we haven\'t seen the accounts. We don\'t know how bad the finances are.\"

arabstoday
arabstoday

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

cyprus bailin ensured russians would be bank saviours cyprus bailin ensured russians would be bank saviours

 



Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

cyprus bailin ensured russians would be bank saviours cyprus bailin ensured russians would be bank saviours

 



Arab Today, arab today
Arab Today, arab today Jordanian woman reveals her project

GMT 00:46 2017 Saturday ,11 November

Jordanian woman reveals her project
Arab Today, arab today The Big Apple bike boom

GMT 10:47 2017 Wednesday ,22 November

The Big Apple bike boom
Arab Today, arab today Keep kids busy at Thanksgiving gatherings

GMT 11:14 2017 Friday ,10 November

Keep kids busy at Thanksgiving gatherings
Arab Today, arab today Leaders of Russia, Iran, Turkey meet

GMT 10:12 2017 Wednesday ,22 November

Leaders of Russia, Iran, Turkey meet
Arab Today, arab today 'Advanced' cyber attack targets Saudi Arabia

GMT 10:18 2017 Wednesday ,22 November

'Advanced' cyber attack targets Saudi Arabia
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today Australian academic's book pulled

GMT 15:20 2017 Monday ,13 November

Australian academic's book pulled
Arab Today, arab today May under Brexit pressure at EU reform summit

GMT 02:14 2017 Saturday ,18 November

May under Brexit pressure at EU reform summit
Arab Today, arab today Delhi half-marathon to go ahead

GMT 03:51 2017 Saturday ,18 November

Delhi half-marathon to go ahead
Arab Today, arab today The history of solar eclipses

GMT 05:16 2017 Sunday ,20 August

The history of solar eclipses
Arab Today, arab today Honda recalls 800,000 minivans

GMT 11:43 2017 Wednesday ,22 November

Honda recalls 800,000 minivans
Arab Today, arab today VW says will invest over 34bn euros

GMT 07:19 2017 Tuesday ,21 November

VW says will invest over 34bn euros
Arab Today, arab today Singer Jahda Wahba has unlimited ambitions

GMT 07:56 2017 Monday ,20 November

Singer Jahda Wahba has unlimited ambitions
Arab Today, arab today paObama climate envoy slams Trump's rejection

GMT 16:04 2017 Friday ,17 November

paObama climate envoy slams Trump's rejection

GMT 09:23 2017 Saturday ,18 November

Fedra happy for “Between Two Worlds” success

GMT 11:15 2017 Thursday ,16 November

Angola oil boss sacked by father's protege

GMT 18:41 2017 Friday ,20 October

Designer Aql Faqih aspires to innovation

GMT 11:38 2017 Wednesday ,15 November

Unloved vultures fight for their survival

GMT 11:49 2017 Thursday ,17 August

Egyptian artist presents new collection of designs

GMT 13:41 2017 Tuesday ,21 November

French choke up over proposal

GMT 00:44 2017 Monday ,20 November

Japanese regulators raid Airbnb

GMT 17:12 2017 Monday ,07 August

Al-Shawaifi reveals secrets of total solar eclipse

GMT 16:53 2017 Tuesday ,05 September

Youssra depended on colored foam
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday