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ECB's Nowotny says Cyprus is a special case
March 26, 2013 / 10:36 AM / 5 years ago

ECB's Nowotny says Cyprus is a special case

PRAGUE (Reuters) - The banking crisis in Cyprus is a special case and the rescue plan used is not a model for other countries, European Central Bank Governing Council member Ewald Nowotny said on Tuesday.

Austrian National Bank (OeNB) Governor and ECB Governing Council member Ewald Nowotny listens as he briefs the media during a news conference in Vienna March 14, 2013. REUTERS/Leonhard Foeger

Early on Monday, Cyprus managed to clinch a deal with international lenders to shut down its second-largest bank and inflict heavy losses on uninsured depositors in return for a 10 billion euro ($13 billion) bailout.

Nowotny echoed earlier comments from ECB Executive Board member Benoit Coeure, who disagreed with Eurogroup head Jeroen Dijsselbloem’s assertion that the Cyprus bailout would serve as a model for crises elsewhere. The Dutchman later backtracked on his comments after markets read them as meaning private sector bail-ins would play a greater role in future rescues.

“Cyprus is a special case,” Nowotny, who is also the head of Austria’s central bank, told reporters at a conference in Prague. “It is no model for other instances.”

Reporting by Jan Lopatka; Writing by Paul Carrel; Editing by Catherine Evans

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