NICOSIA Feb 21 Cyprus further eased domestic
capital restrictions on Friday as part of an incremental
relaxation of currency controls first imposed to prevent a run
on its banks in March 2013.
In a Finance Ministry decree, authorities scrapped the
compulsory automatic renewal of fixed term deposits and
increased the allowance on domestic cash transfers for both
companies and individuals.
A ban on cashing in cheques and a 300 euro cash withdrawal
limit daily remained in force. The daily withdrawal allowance is
cumulative from March 27, 2013.
The Mediterranean island became the first euro zone member
state to impose capital controls to prevent a collapse of its
banking system last March.
It was preceded by a decision to close a major bank, and
force depositors to give up savings to recapitalise a second in
return for 10 billion euros in aid from the International
Monetary Fund and the European Union.
Friday's decree, valid for 35 days, increases the allowance
on cash transfers to 20,000 euros for individuals, and 100,000
for companies on a monthly basis, irrespective of purpose. The
previous limit was 15,000 euros, and 75,000 euros respectively.
Authorities are following a milestone-based roadmap for
easing restrictions, under which domestic controls will be eased
Cyprus's Central Bank governor last week said that the
island nation could abolish all controls by the end of this year
if sufficient progress was made in adopting its bailout
programme and confidence was fully restored in the economy.
(Reporting By Michele Kambas)