Cypriots edgy as banks reopen
By The Associated Press
Published: Thursday, March 28, 2013, 9:57 p.m.
NICOSIA, Cyprus — Anxious Cypriots patiently waited in long lines to get at their accounts on Thursday, when banks opened for the first time in nearly two weeks after an international bailout to save the country's financial system.
Fearing a run on its banks, the tiny Mediterranean country has imposed daily withdrawal limits of 300 euros ($384) for individuals and $6,416 for businesses — the first so-called capital controls that any country has applied in the eurozone's 14-year history.
Financial strains are building on families and businesses, and the recession in Cyprus is likely to deepen. The mood outside banks was calmer than feared. Many people said the withdrawal limits were probably necessary to keep a bad situation from spiraling out of control.
Flower shop owner Christos Papamichael was among about 30 people waiting for bank doors to open. “Everything has been paralyzed ... No one thinks of buying flowers,” he said.
Banks had been shut since March 16 to prevent people from draining their accounts as politicians scrambled to save the country's stricken financial sector. ATM machines were working, but with a limit on daily withdrawals.
An initial plan to seize up to 10 percent of all Cypriot deposits caused an international uproar and was scrapped. But in order to secure $12.9 billion in loans from other euro countries and the International Monetary Fund, Cyprus agreed Monday to wind down its second-largest bank and seize billions from accounts holding more than the insured limit of 100,000 euros.
European financial markets, which have been on edge for weeks, rose slightly. The FTSE 100 index of leading British shares rose 0.4 percent, while Germany's DAX index rose 0.1 percent.
Government and bank officials had feared that up to 10 percent of the country's deposits could be siphoned off when banks opened — but that did not appear to happen.
\. Guards from private security firms reinforced police outside some ATMs and banks in the capital, Nicosia. No problems controlling crowds were reported.
The limits on withdrawals and other capital controls are expected to be relaxed gradually. Analysts say it's anyone's guess how people and businesses will react once that happens.
Foreign Minister Ioannis Kasoulides said that, according to central bank estimates, the controls would be fully lifted in a month. Some analysts say it could last longer.
President Nicos Anastasiades expressed in a statement his “warm gratitude and deep appreciation towards the Cypriot people for the maturity and spirit of responsibility they have shown at a critical time for the stability of the Cypriot economy.”
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- American teacher shot dead in Benghazi
- Syrian troops capture key town
- North Korea leader apparently boots uncle from post
- Detained vet worked with group of guerillas
- U.S. can’t get China to yield on contentious air zone
- ‘Dangerous’ radioactive material found in Mexico
- Egyptian satirist says show’s suspension wasn’t ‘nice’
- Iran invites U.N. inspectors to nuclear facility
- Canada reportedly permitted NSA surveillance at G-20
- Syrian refugee children work, provide for families
- General apologizes for Afghan airstrike