02 April 2013

Central Bank of Cyprus: Third Decree for Temporary Restrictive Measures on Transactions

On 2nd April 2013 the Cypriot authorities set up a commission of enquiry to identify responsibilities for the scandals linked to the financial turbulence that has rocked the country, and to establish any possible offences. That same day, Cyprus also announced an easing of capital movement controls. The Cypriot authorities have also decided, in agreement with the country's international financial backers, to unblock a quarter of the assets frozen on accounts held by the Bank of Cyprus with a balance of more than €100,000.

The Cyprus bailout agreement states that 37.5 per cent of deposits of over €100,000 will be converted into shares in the bank and that an additional 22.5 per cent may be converted, if necessary. The troika is also allowing Cyprus more time in which to achieve the deficit reduction objectives set for it. Cyprus now has until 2018 to achieve a primary budget surplus of 4 per cent.

Reporting by Robert Schuman Foundation

Third Decree

As mentioned before the credit institutions reopened, the CBC will closely monitor developments and make appropriate adjustments to ensure the stability of the financial sector.

In this context:

1. Payments through cheques to accounts held in other credit institutions are allowed for up to €9,000 per month per natural person in each credit institution.
2. The amount for payments to other credit institutions for transactions that fall within the normal business activity of the customer that are not subject to any restrictive measures has increased from €5,000 to €25,000 per day per account.
3. There is no restriction for the payment of tuition fees of a person studying in educational institutions in Cyprus.
4. Fixed term deposits can be terminated in order to create one or more fixed term deposits for the total amount which is equal to the initial deposit and for a term at least equal to the initial term of the terminated deposit.

Press release

© Central Bank of Cyprus