Reuters - Video

EDITION: U.S. | U.K. | IN

Business

Cyprus finalizes capital controls to avoid bank run

Wednesday, March 27, 2013 - 02:35

March 27 - Cyprus is putting the finishing touches to capital control measures to prevent a run on the banks after the country agreed a painful rescue package with international lenders. As protests gather pace Ciara Sutton reports on what is likely to happen when the banks reopen on Thursday.

▲ Hide Transcript

View Transcript

Father of four Sotiris Dimitriades has become dependent on this food bank in Cyprus. (SOUNDBITE)(Greek) SOTIRIS DIMITRIADES, UNEMPLOYED FATHER OF FOUR CHILDREN SAYING: "I have a little bit of money in the bank but I cannot get to it because they're closed. Right now I don't have any money so how am I going to get by? How am I going to buy groceries?" This soup kitchen opened last year, helping 600 families - that's now reached 1,700 as the island struggles with an economic crisis. The soup kitchen's director expects things to get worse. SOUNDBITE: SOUP KITCHEN DIRECTOR PANAGIOTIS PANAGIOTOU SAYING (Greek): "The signs are that the number of families will keep increasing. We receive telephone calls every day from people who are worried they'll lose their jobs and asking if we will be able to give them food." Banks will reopen on Thursday after being closed for six days. The government has been scrambling to bring in banking system reforms. It's finalising capital control measures to prevent money flying out of the country after it agreed a painful rescue package with international lenders. Cyprus will tax large deposits over 100,000 euros and merge banks, as agreed with the EU and IMF. Banks are also expected to place limits on withdrawals of money, or what customers can shift between accounts or across borders. But Nick Beecroft from Saxo Bank is optimistic about the capital control measures. (SOUNDBITE) (English) NICK BEECROFT, CHAIRMAN & SENIOR MARKET ANALYST, SAXO BANK, SAYING: "I think they will be successful, because now the ECB liquidity tap is back on again. How long they'll last is a moot point. Some of these temporary measures have become pretty permanent over the years. I suspect once again this will be contained and because of the ECB's backstop, maybe we are only talking about a matter of weeks here rather than months." Russian citizens have billions of euros in Cypriot banks. And Moscow is concerned about healthy banks being controlled too. The bailout package is expected to really hit Cypriots - who are already suffering due to cuts and 15% unemployment. The country's Parliamentary Speaker says it's facing a vicious circle of recession. (SOUNDBITE)(English) PARLIAMENTARY SPEAKER YANNAKIS OMIROU SAYING: "We expected support and understanding from our partners but instead we are subjected to resolution of our financial system and devastating measures leading our country to further recession, unemployment and poverty." But European leaders say the deal averted a chaotic national bankruptcy that might have forced Cyprus out of the euro.

Press CTRL+C (Windows), CMD+C (Mac), or long-press the URL below on your mobile device to copy the code

Cyprus finalizes capital controls to avoid bank run

Wednesday, March 27, 2013 - 02:35

Top News »

Investing 201 »

Arian Foster = BlackBerry? Arian Foster = BlackBerry?

Fri, Oct 25, 2013 - (3:16)

Don’t miss these red flags for IPOs Don’t miss these red flags for IPOs

Thu, Oct 10, 2013 - (2:34)

Copycat currency trading Copycat currency trading

Wed, Oct 02, 2013 - (2:28)

When to dump a winner When to dump a winner

Tue, Sep 24, 2013 - (1:55)

Where gold might again attract Jim Rogers Where gold might again attract Jim Rogers

Thu, Sep 19, 2013 - (2:05)

Why savings interest rates won't budge Why savings interest rates won't budge

Fri, Sep 13, 2013 - (2:09)

Buy local? ETFs try the trend Buy local? ETFs try the trend

Thu, Sep 05, 2013 - (2:42)

The better bond funds The better bond funds

Wed, Aug 07, 2013 - (2:40)

Best bargain in 40 years? European stocks Best bargain in 40 years? European stocks

Thu, Aug 01, 2013 - (2:24)

Invest like an activist Invest like an activist

Fri, Jul 26, 2013 - (2:49)

Money Clip »

3 things to do before disaster strikes 3 things to do before disaster strikes

Wed, Sep 18, 2013 - (1:39)

Your must-do money list Your must-do money list

Wed, Sep 11, 2013 - (1:24)

The worst "best" financial advice The worst "best" financial advice

Wed, Sep 04, 2013 - (1:42)

Forget gold: The case for REITs Forget gold: The case for REITs

Fri, Apr 26, 2013 - (1:19)

3 rules for buying a house now 3 rules for buying a house now

Thu, Apr 18, 2013 - (1:39)

“Stalking” your dream home - Money Clip “Stalking” your dream home - Money Clip

Wed, Mar 27, 2013 - (2:50)

3 hidden tax deductions - Money Clip 3 hidden tax deductions - Money Clip

Thu, Mar 21, 2013 - (1:33)

Moving Pictures »

Still missing – MH370 Still missing – MH370

Fri, Sep 05, 2014 - (2:05)

Images of August Images of August

Fri, Aug 29, 2014 - (1:00)

Burning Together Burning Together

Mon, Sep 01, 2014 - (2:23)

Mending dolls, teddies and hearts Mending dolls, teddies and hearts

Fri, Aug 22, 2014 - (3:12)

"Old timers" sail the Chesapeake Bay "Old timers" sail the Chesapeake Bay

Mon, Aug 11, 2014 - (2:27)

Burned memories Burned memories

Fri, Aug 08, 2014 - (3:02)

Images of July Images of July

Thu, Jul 31, 2014 - (1:20)

World Cup: passion on the pitch World Cup: passion on the pitch

Fri, Jul 11, 2014 - (1:00)

A refugee in America gives back A refugee in America gives back

Wed, Jul 02, 2014 - (3:25)

A long search for refuge A long search for refuge

Fri, Jun 20, 2014 - (3:04)

Reuters Investigates »

Re-homing victim: "I could have been dead" Re-homing victim: "I could have been dead"

Wed, Feb 19, 2014 - (8:24)

Cops and loggers in the Amazon rainforest Cops and loggers in the Amazon rainforest

Fri, Jan 10, 2014 - (4:01)

"Passed around like a dog" "Passed around like a dog"

Thu, Aug 29, 2013 - (6:32)

Adopted, then abandoned online Adopted, then abandoned online

Thu, Aug 29, 2013 - (13:21)

How the DEA keeps its secrets secret How the DEA keeps its secrets secret

Mon, Aug 05, 2013 - (1:36)

How education lost its role as the great equalizer - Reuters Investigates How education lost its role as the great...

Mon, Dec 17, 2012 - (7:52)

Jihad Jane: From abused child to American jihadist - Reuters Investigates Jihad Jane: From abused child to American...

Sat, Dec 08, 2012 - (10:01)

Jihad Jane: The order to kill - Reuters Investigates Jihad Jane: The order to kill - Reuters...

Sun, Dec 09, 2012 - (10:39)