INTERNATIONAL businesses are still using Cyprus as their base despite the tough terms of a €10 billion bailout agreement that featured a haircut on uninsured deposits in a bid to recapitalise the island’s largest banks, accountants said yesterday. A delegation of the Institute of Certified Public Accountants of Cyprus (ICPAC) met with technocrats from the delegation of Cyprus’ international lenders, currently conducting the second review of the island’s adjustment programme. “Seven months after the Eurogroup decisions, most international companies have not fled Cyprus and the impression that a lot of bad things would descend upon us has not materialised,” Nicos Chimarides ICPAC vice chairman has said.
He added however that it would take six more months for the situation to become clearer.
Chimarides said however that capital controls imposed since the March Eurogroup decisions should be gradually lifted and the banking system consolidated, before Cyprus restored its image as an international financial centre.
Meanwhile talks between the Central Bank (CBC) and international lenders focused on the restructuring plans for co-operatives and Bank of Cyprus.
Co-operatives will be nationalised after the state poured in €1.5 billion from the bailout funds, their number will be cut from 93 to 18, and branches will close.
Today, discussions will cover the defunct Laiki Bank and Hellenic Bank.
In March, the government agreed with the troika (European Commission, European Central Bank and the IMF) on a €10 billion bailout, which featured a haircut on uninsured deposits in Bank of Cyprus, the island’s largest lender to replenish the bank’s capital shortfall. Cyprus Popular Bank would be wound down with its good part absorbed by BoC, as part of the deal.
Most foreign companies have stayed