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| Cyprus leader Anastasiades attacks bank bailout terms | Cyprus leader Anastasiades attacks bank bailout terms |
| (35 minutes later) | |
| Cyprus President Nicos Anastasiades has urged eurozone leaders to revise the terms of his country's bank bailout, in a highly critical letter. | |
| He said the "haircut" imposed on large deposits under the 10bn-euro (£8.6bn) bailout had significantly eroded the capital kept by businesses in banks. | |
| Losses were imposed on big deposits in Bank of Cyprus (BoC) and Laiki Bank. BoC is now in trouble, the letter said. | Losses were imposed on big deposits in Bank of Cyprus (BoC) and Laiki Bank. BoC is now in trouble, the letter said. |
| The letter to Cyprus's creditors, sent last week, was leaked on Wednesday. | |
| "I urge you to support a long-term solution to Bank of Cyprus' thin liquidity position," Mr Anastasiades said. | "I urge you to support a long-term solution to Bank of Cyprus' thin liquidity position," Mr Anastasiades said. |
| Laiki Bank is being wound up and its safe assets transferred to BoC. | Laiki Bank is being wound up and its safe assets transferred to BoC. |
| For large depositors at both banks the first 100,000 euros is protected, but the government can tap up to 40% of their remaining deposits, to contribute billions towards the bailout. | For large depositors at both banks the first 100,000 euros is protected, but the government can tap up to 40% of their remaining deposits, to contribute billions towards the bailout. |
| But Mr Anastasiades complained that "no distinction was made between long-term deposits earning high returns and money flowing through current accounts, such as firms' working capital". "This amounted to a significant loss of working capital for businesses." | But Mr Anastasiades complained that "no distinction was made between long-term deposits earning high returns and money flowing through current accounts, such as firms' working capital". "This amounted to a significant loss of working capital for businesses." |
| Capital restrictions imposed to prevent a run on Cypriot banks have been eased, but remain in place. The president said such "artificial" measures "will only aggravate the depositors the longer they persist". | Capital restrictions imposed to prevent a run on Cypriot banks have been eased, but remain in place. The president said such "artificial" measures "will only aggravate the depositors the longer they persist". |
| "Rather than creating confidence in the banking system they are eroding it by the day," he warned. | "Rather than creating confidence in the banking system they are eroding it by the day," he warned. |
| The text of his letter appeared on the Open Europe think tank's blog on Wednesday. His complaints about the bailout were also reported by the Financial Times. | The text of his letter appeared on the Open Europe think tank's blog on Wednesday. His complaints about the bailout were also reported by the Financial Times. |
| Unnamed eurozone officials quoted by Reuters news agency say there are no plans to alter the terms of the bailout for Cyprus or to supply more funds. | Unnamed eurozone officials quoted by Reuters news agency say there are no plans to alter the terms of the bailout for Cyprus or to supply more funds. |
| Eurozone finance ministers will discuss the letter at a meeting in Luxembourg on Thursday, Reuters reports. | Eurozone finance ministers will discuss the letter at a meeting in Luxembourg on Thursday, Reuters reports. |
| Cyprus has started receiving instalments of the bailout package from international creditors. | Cyprus has started receiving instalments of the bailout package from international creditors. |