Hiển thị các bài đăng có nhãn Thursday. Hiển thị tất cả bài đăng
Hiển thị các bài đăng có nhãn Thursday. Hiển thị tất cả bài đăng

Thứ Tư, 27 tháng 3, 2013

Cyprus banks to reopen on Thursday

Bank of Cyprus branchBank of Cyprus is the country's largest bank

Banks in Cyprus are to reopen on Thursday at 10:00 GMT, 10 days after they closed to prevent a bank run as a controversial bailout was negotiated.

Banks will open their doors between noon and 18:00 local time, the spokesperson for the Cypriot central bank said.

Cyprus is also to introduce capital controls, with exact details expected to be finalised later on Wednesday.

Earlier, the boss of the Bank of Cyprus was sacked.

The capital controls are to be imposed as Cyprus seeks to raise 5.8bn euros ($7.4bn; £4.9bn) to qualify for a 10bn-euro bailout from the European Union, European Central Bank and the International Monetary Fund, the so-called troika.


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Thứ Hai, 25 tháng 3, 2013

Cyprus banks closed until Thursday

laiki bank in CyprusLaiki Bank and Bank of Cyprus will remain shut until later in the week

Most Cypriot banks are to reopen on Tuesday, although the two at the centre of the crisis, Bank of Cyprus and Laiki, will remain shut until Thursday.

The country's president, Nicos Anastasiades said there would be limits on some transactions, but did not give full details.

Capital controls to prevent money leaving the country are already in place.

Certain limits on the size of cash withdrawals are expected to continue.

The banks' reopening came after Cyprus agreed a deal with the International Monetary Fund (IMF) and the European Union (EU) that releases 10bn euros in support.

It was conditional on Cyprus itself raising billions of euros, which it will do by way of a tax on deposits of more than 100,000 euros (£85,000).

The banks shut a week ago after the country's first money-raising solution, which would have hit smaller deposit holders as well as larger holding, was rejected.

Mr Anastasiades said the restrictions would be temporary.

'Specific case'

On Monday morning, hopes the deal would solve the crisis lifted shares.

But later stock markets were rocked after the head of the Eurogroup of eurozone finance ministers suggested that the deal for Cyprus model could form a template in any future bailout.

Jeroen Dijsselbloem, the Dutch finance minister who as head of the Eurogroup played a key role in the Cyprus negotiations, said the deal represented a new template for resolving future eurozone banking problems.

"If there is a risk in a bank our first question should be 'OK, what are you in the the bank going to do about that?'," he told Reuters and the Financial Times.

He later added a clarification, saying that Cyprus was "a specific case with exceptional challenges".

The Cyprus deal puts the burden for dealing with problem banks on their shareholders and creditors - in this particular case, customers with large bank balances - rather than the government and taxpayers, or bondholders, who lend through financial markets.

“Start Quote

The deal hammered out for Cyprus last night isn't 'fair'. Cyprus has not received the same treatment as other bailed-out eurozone economies”

End Quote

The BBC's Andrew Walker points out that the more common approach to failing banks in the current crisis has been for the state to inject new capital.

He says Cyprus's banks are unusual in that they have relatively few financial market investors who could be tapped.

In the past, nations such as Ireland have pumped billions of taxpayers' money into propping up their banks, rather than risk upsetting large investors and spooking the financial system.

Small savers protected

Mr Dijsselbloem said the pattern for bank rescues should see shareholders take the first hit, then bondholders, who lend money through financial markets, and only then should depositors with large bank balances.

“Start Quote

The bailout and rescue of Cyprus by the eurozone and IMF will not feel like much of a rescue to its people, who face economic misery”

End Quote

The Cypriot government suggested that account holders with deposits of more than 100,000 euros should expect to lose about 30% of their balances.

Major depositors, many of whom are wealthy Russians, will not be able to access accounts exceeding the 100,000-euro limit until the restructuring of the banks is complete.

Small savers will be protected but Cyprus's second largest bank - Laiki Bank - will be wound up and split into "good" and "bad" banks, with its good assets eventually merged into the Bank of Cyprus, the country's biggest bank.

The UK's FTSE 100 index ended the day down 0.2%, while Germany's Dax gave up 0.5%, and France's Cac lost 1.1%. In New York, the Dow Jones was 0.5% lower.

In Madrid, the market slipped 2.5% while the Milan index was down 2.27%.

The euro was also driven lower, falling to a six-week low against the pound. The euro was down 0.6% to 84.74 pence.

'Deep recession'

Jeroen Dijsselbloem

Jeroen Dijsselbloem

  • Aged 46, member of Dutch Labour party
  • Became Netherlands finance minister four months ago and took over as chair of Eurogroup in January
  • Criticised by predecessor Jean-Claude Juncker and MEPs over initial terms of Cyprus bailout
  • No previous experience in finance but studied agricultural economics and business
  • Favours reform of the financial sector and a Europe where 'every country brings its budget in order'

The new deal for Cyprus, unlike previous agreements, does not require the approval of the Cypriot parliament.

The uncertainty over the future of Cyprus in the eurozone was sparked a week ago when its parliament rejected an earlier bailout deal, which also included a controversial bank levy.

Despite the Cypriot economy's relatively small size, many analysts had been concerned that the crisis would spread to the wider eurozone, had Cyprus been forced to give up the single currency.

There were fears that the country's possible exit from the euro would trigger a loss of confidence across the single currency bloc, and prompt investors to withdraw from other troubled economies, such as Greece.

However, while Cyprus is now likely to remain in the eurozone, the country still faces significant obstacles as it attempts to recover from the crisis.

The EU-IMF deal involves a massive restructuring of the Cypriot banking system, as well as austerity measures and tax increases.

There has also been significant public anger in Cyprus at the intervention of European authorities, and the credibility of the Cypriot government has been questioned.

"We see a risk that Cyprus' sovereign debt burden post-bailout might not be sustainable, as the country is likely to enter a deep recession caused by the shrinkage of the banking sector and severe deleveraging," warned Reinhard Cluse, an economist at UBS.


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Thứ Tư, 20 tháng 3, 2013

Senate passes government funding measure; House to vote Thursday - Washington Post

A short-term funding measure that would ensure the government continues operating beyond this month cleared the Senate Wednesday, awaiting only final House passage on Thursday to avert any possibility of a shut-down.

The process of approving the proposal has been unfolding remarkably smoothly for a divided Congress that has gone to the brink repeatedly over spending issues.

Video

The Washington Post’s Ed O’Keefe explains one way Congress copes with big disagreements over the federal budget.

The Washington Post’s Ed O’Keefe explains one way Congress copes with big disagreements over the federal budget.

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If the House approves the bill before it leaves for a two-week holiday recess on Friday, funding will be assured a full week before the March 27 expiration of the resolution that is now keeping the government in operation.

And yet the 73 to 26 final Senate vote came days later than leaders had hoped. Passage was slowed by a familiar disagreement over how many amendments the chamber should consider for a bill that outlines spending priorities for every federal agency for the final six months of the fiscal year.

Few if any of the amendments were ever expected to pass.

The amendment tussle aside, the legislation has proceeded through both chambers with relatively few hiccups so far. That’s something of a surprise given that some House Republicans, smarting from the year-end “fiscal cliff” drama, had promised to use the must-pass measure to force concessions from Democrats on deficit reduction, including entitlement reform.

Instead, House Republicans now seem content with a bill that locks in the spending cuts of the so-called sequester for the rest of the year. Likewise, Democrats, who want to reverse the sequester, agreed the short-term bill would leave it in place for now.

They have instead proposed replacing the sequester in part with higher tax revenues, but doing so through broader budget negotiations that outline future spending.

But on Wednesday, in more of the legislative squabbling that has slowed the pace of the Senate almost to a crawl, senators in both parties tried to force votes on their favorite issues.

Many were attempts to blunt the impact of the $85 billion across-the-board sequester spending cuts on specific programs or agencies.

By late last week, senators had filed 126 separate amendments they wanted to be heard on the floor. Five senators, for instance, proposed slightly different versions of proposals to cut off foreign aid to Egypt.

“I love the Senate. And we love to talk. And we love to amend...But we are now at the point where the bill must really come to a close,” said Sen. Barbara Mikulski (D-Md.), the chairwoman of the appropriations committee responsible for the bill, as she proposed a procedure on Monday that would help shepherd it to final passage.

Ultimately, the Senate voted on 10 amendments.

One, proposed by Sen. Tom Coburn (R-Okla.), would have shifted $6 million in parks funds to free up money to potentially allow the White House, Yellowstone National Park and the Flight 93 Memorial in Shanksville, Pa. to reopen to public tours.

It failed on a 45 to 54 vote, with Democrats in opposition.

Another, sponsored by Sen. Roy Blunt (R-Mo.) and Sen. Mark Pryor (D-Ark.), would transfer $55 million in agriculture dollars to prevent furloughs among food inspectors and a third would require tuition assistance programs for military service members, suspended due to the sequester, to be restarted.

They passed.

Sen. Jerry Moran (R-Kansas) wanted an amendment to keep air traffic controllers on the job--some towers at smaller airports are scheduled to close due to the sequester’s cuts. He didn’t get a vote at all.

Just before the Senate voted on the full bill, Mikulski praised senators for working in a bipartisan fashion to improve on a bill that had been passed by the House earlier this month. “We didn’t want brinkmanship politics. We didn’t want ultimatum politics,” she said.

To blunt the impact of the sequester, the House introduced new priorities for military spending in its version of the bill. The Senate bill added several other areas to the bill, including agriculture, commerce, science, justice and homeland security.

The result is to add money to certain key programs; all were offset with cuts elsewhere.

The broader budget negotiation process begins this week with passage of budget blueprints in both chambers.

Ed O’Keefe contributed to this report.

Discuss this topic and other political issues in the politics discussion forums.


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