“I am very satisfied that our Eurogroup joint statement respects the dignity of the Cypriot people by letting their own Authorities decide the appropriate administrative measures they deem fit to apply for their exceptional situation of their financial sector,” said Minister Scicluna following the conclusion of the Eurogroup meeting which was convened in Brussels on 24 March 2013.
At this meeting, Eurozone Finance Ministers agreed a last minute plan for Cyprus in view of the looming deadline set by the European Central Bank that it would stand ready to cut its emergency lending assistance to Cypriot banks if a bailout package was not agreed by Monday 25 March.The meeting which lasted into the early hours of Monday morning was preceded by another high level meeting between the President of Cyprus Nicos Anastasiades, José Manuel Barroso, the European Commission president, Herman Van Rompuy, the European Council chief, and Jeroen Dijsselbloem, the Dutch finance minister who heads the Eurogroup. The leaders were then joined by Mario Draghi, ECB president, and Christine Lagarde, IMF managing director.
The agreed bailout package retains a financial envelope in the region of €10 billion but does not maintain the controversial levy on insured deposits (below €100,000) suggested last week. However, uninsured deposits (those in excess of €100,000) in the two major banks will suffer losses as part of the restructuring exercise. The package will also allow the Cypriot Government to make use of capital controls to contain the cash outflows from the banking system. At the same time, the European Commission will monitor that such measures applied remain temporary, proportionate and applied in a non-discriminatory manner.
This agreement attained the support of all euro area Member States as well as the ECB, IMF and the European Commission. The programme will address the exceptional challenges that Cyprus is facing and restore the viability of the financial sector, with the view of restoring sustainable growth and sound public finances over the coming years.
Minister of Finance, Prof Edward Scicluna who attended the extraordinary Eurogroup meeting, was accompanied by the Permanent Secretary in the Ministry of Finance, Mr. Alfred Camilleri.
“Once we are satisfied that the deposit guarantee is respected we should offer all the assistance we can give within the €10 billion limit to contain the mishap which has befallen Cyprus,” concluded Minister Scicluna.
– Monday, 25th March, 2013