Confusion and frustration over capital controls.
a Staff Reporter
PUBLIC SHOCK about the tough terms of the international
The financial rescue of a faltering business or other organization. Government guarantees for loans made to Chrysler Corporation constituted a bailout.
turning into anger as millions of euros remain locked in the banks under
capital control regulations.
Anxiety is being deepened by confusion over how the hastily-imposed
rules should operate.
Hundreds of bank workers protested outside parliament on Thursday,
worried that they could lose much of their pension savings under the
terms of the bailout deal which stipulates that some depositors will
part of the rescue’s cost if their accounts hold more than 100,000
“I am disappointed and angry,” said Iacovos Louca, 53,
who works at Popular Bank, which is being wound down under the 10
billion euro deal with the EU and International Monetary Fund. “The
politicians are out of touch with our problems and the big guys, who had
the information, managed to take their money abroad.”
One company in Nicosia which has several offices abroad has been
as the central bank now has to approve transfers out of
Cyprus over 25,000 euros. As part of the company’s payroll is
managed from the island, payments to employees abroad are being delayed
because of the vetting process and currency controls to avoid a bank
“We have held clients’ money for certain pre-paid jobs,
and we have a cash flow issue now,” the owner of the services
company said, on condition of anonymity. “We have to make payments
of more than 1 million euros on behalf of our clients, and now we can
only use 100,000.”
Lack of clear answers on where their money may end up is fuelling
Andrew Georgiou, a 55-year-old British consultant who moved to
Cyprus a year ago with the earnings from the sale of his home in London,
says all four accounts he holds with Popular – even a sterling account
containing just 22
n. Chiefly British
A plural of penny.
a plural of penny
USAGE: Since the decimalization of British currency and the introduction of the abbreviation p,
– are blocked.
These totalled 97,000 euros and under the bailout deal, deposits
under 100,000 are fully insured. Nevertheless, Georgiou is now unable to
access any funds.
Georgiou, who is of Cypriot descent, said Popular Bank had
justified its action on the grounds that he was also considered a
beneficiary to an account held by his 78-year-old father. It also
covered money held in a trust for medical expenses.
“I wrote to the central bank and they came back saying that it
was not their competence, so whose competence is it?” said
Georgiou. “Nobody is explaining where anyone should go with a
As a result, Georgiou has been told he and his father could
tr.v. en·ti·tled, en·ti·tling, en·ti·tles
1. To give a name or title to.
2. To furnish with a right or claim to something:
only to a combined 40,000 euros despite the
100,000 euro guarantee, a fraction of their savings in Popular.
“Absolutely nothing adds up,” he said. “They told us it
was 140,000 last week.”
Georgiou and others like him are in for a long wait to figure out
what went wrong. Three judges appointed to look into the island’s
financial collapse started work on Thursday.
With an extensive
ranging from the business sense of Cypriot
banks hoarding a mass of Greek government bonds while others were
selling them and the prudence of government fiscal policies, the judges
will need a small army of consultants.
in the meantime
, resigned to years of hardship. Iraklis
Paraskeva, 53, has three children to support, now studying in Greece.
“I am going to find myself in the street with no future, only
debts. But we will fight to the end. We have nothing left to lose.”
millions of euros remain locked in the banks under capital control
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