Cyprus currency clampdown to go on for a MONTH: Banks open for the first time in two weeks

Cyprus currency clampdown to go on for a MONTH: Banks open for the first time in two weeks

  • Draconian currency controls will remain in place till the end of April
  • Armed police and security staff on guard as banks reopened yesterday
  • Maximum cash withdrawal limit has been set at 300 euros (£250) per day
  • Travellers leaving country can only take equivalent of 1,000 euros (£850)
  • Curbs will be in place for at least seven calendar days and reviewed daily
  • Cypriot President slashes his own salary by 25% in show of solidarity
  • The stock market will remain closed today ‘in order to protect investors’
  • Banks shut since March 16 as politicians struggled to secure EU bailou

Cyprus was warned it faces another month of Draconian currency controls as its banks finally reopened yesterday after two weeks.

The clampdown, supposed to be in place for just a week, was extended until the end of April amid claims that the European Union is engineering the ‘brutal destruction’ of the country’s economy.

Billions of euros in banknotes were delivered to banks by armoured lorry in the expectation of crowds wanting to withdraw funds.

 

Dash for cash: A Laiki bank manager tries his best to calm depositors eager to get hold of their money as the branch in Nicosia, Cyprus, prepared to open for the first time in two weeksDash for cash: A Laiki bank manager tries his best to calm depositors eager to get hold of their money as the branch in Nicosia, Cyprus, prepared to open for the first time in two weeks

Chaos: Bank staff had turned up for work early as cash was delivered by armoured trucks amid tight security and controls on withdrawalsChaos: Bank staff had turned up for work early as cash was delivered by armoured trucks amid tight security and controls on withdrawals
Cash and grab: Long lines had formed outside some bank branches, particularly those of Laiki (like this one above), which is to be restructured, before they openedCash and grab: Long lines had formed outside some bank branches, particularly those of Laiki (like this one above), which is to be restructured, before they opened
Run in the sun: Bank customers cram into a branch of the Bank of Cyprus in Nicosia to get hold of their cash after it opened its doors for the first time in two weeks at 10am GMT todayRun in the sun: Bank customers cram into a branch of the Bank of Cyprus in Nicosia to get hold of their cash after it opened its doors for the first time in two weeks

But the controls, designed to stop a run on the banks, meant customers were banned from withdrawing more than 300 euros (£250) per day. Banks also refused to cash cheques and travellers were banned from leaving the country with more than 1,000 euros (£850).

Cyprus’s foreign minister Ioannis Kasouldides said the restrictions will continue for ‘about a month’.

The Cypriot stock exchange will also stay closed until after Easter to prevent a damaging run on shares which would compound the banking problems.

Keeping watch: Hundreds of staff from private security firm G4S were placed on standby over fears of a run on depositsKeeping watch: Hundreds of staff from private security firm G4S were placed on standby over fears of a run on deposits

Uncertainty: An elderly woman looks at a savings book as people wait in line in front of a branch of the Laiki Bank in Nicosia, Cyprus

Uncertainty: An elderly woman looks at a savings book as people wait in line in front of a branch of the Laiki Bank in Nicosia, Cyprus

Cyprus bailout graphic

Chancellor George Osborne also revealed the Treasury is working on a solution for the 13,000 UK customers of Cyprus Popular Bank, part of Laiki Bank, who could lose up to 40 per cent of their savings above the 100,000 euros (£85,000) cut-off limit.

A spokeswoman for the DWP said a ‘watching brief’ is in place on the situation but payments into Cypriot bank accounts will not resume when banks on the island reopen.

In a statement to MPs, Pensions Minister Steve Webb said the Government is advising people to either switch their payments to a British account they already have or to open a new one.

About 6,000 of the 18,133 British expats on Cyprus use a British bank account already and so are not affected by the freeze.

All except the country’s two largest lenders had been due to open earlier this week after the country clinched an 11th-hour deal with the 17-nation eurozone and the International Monetary Fund.

But the Central Bank said that ‘for the smooth functioning of the entire banking system, the finance minister has decided, after a recommendation by the governor of the Central Bank, that all banks remain shut up to and including Wednesday’.

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One thought on “Cyprus currency clampdown to go on for a MONTH: Banks open for the first time in two weeks

  1. Pingback: weekend Breaking NEWS HEADLINES | count down to zero-time

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