Cyprus: Banks Stay Closed For Few More Days!

Although Cyprus finally reached an agreement for a €10 bn rescue package for its banks, they are still going to be closed for few days. This piece of news was brought up by President Nicos Anastasiades who also acknowledged that his country had come “a breath away from economic collapse” before the bailout negotiations being finalized.

As many investors and bond-holders are now nervous because of the situation and there is a serious risk or capital flight, the country has put capital controls in place but according to the president and officials they will be  “very temporary measures that will be gradually relaxed”.

Even though there is an agreement for the bailout, government officials mentioned on Monday night that all Cypriot banks, including the stricken Laiki and Bank of Cyprus, would remain closed at least until Thursday.

Markets does not like what’s happening in Cyprus: European bank stocks and the euro zone in general  suffered sharp losses following Mr Dijsselbloem’s comments. Euro fell more than 1 per cent against the dollar, and the shares of banks such as Italy’s UniCredit and Intesa Sanpaolo, and French Société Générale all lost 6 per cent.