In a last minute deal Cyprus managed to secure the €10 bn bailout it requires to avoid bankruptcy. The Cypriot parliament agreed on a deal which will see bank deposits over €100,000 taxed. The troubled Laiki Bank will also be wound up, and split into two parts a “good” bank and a “bad” bank. The largest Cypriot bank, the Bank of Cyprus, will undergo major restructuring. Deposits in the Bank of Cyprus over €100,000 have now been frozen.
It is believed the levy on bank deposits will be around 30%. The Cypriot finance minister said they were keen to protect individuals and small depositors. The majority of account holders with over €100,000 are wealthy Russians. The deal has angered Moscow, who have accused the eurozone of using the crisis to go after Russian money.
Laiki and Bank of Cyprus remain closed with ATM withdrawals limited to €100 a time.