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ARTICLE · 19 JUNE 2013

Update On The Cyprus Macroeconomic Adjustment Programme

Michael Kyprianou & Co. LLC
Michael Kyprianou & Co. LLC
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A discussion on the most recent updates on the Cyprus macroeconomic adjustment programme.

CyprusFinance and Banking
Christos Galanos
Christos Galanos
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It is possible to deduce from these two decrees that the resolution of these two banks will take the following form:

Cyprus Popular Bank Public Co Ltd (hereafter "Laiki Bank") will be 'resolved' immediately with the full contribution of equity shareholders, bond holders and uninsured depositors. Laiki Bank will be split into a good bank and a bad bank. The bad bank will be run down over time while Bank of Cyprus ('BoC') will absorb the good bank.

Laiki Bank will transfer to BoC all of its assets, property titles and rights apart from certain exceptions. The exceptions relate mostly to Laiki Bank shares in subsidiary companies outside Cyprus, Laiki Bank assets and rights in the United Kingdom and Greece, and provisions relating to the offsetting of loans owed towards Laiki Bank with deposits held therein.

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