Cyprus-Forum.com

[Jerry]

A run on the banks when they open maybe restricted in two ways. The large deposit accounts that earn the highest interest usually require notice for withdrawals, some impose a penalty for early withdrawal. The banks may only allow limited withdrawals each day rather like they do with ATMs. I really can't see bank customers being hit again with another levy, that really would destroy confidence in banks worldwide.

[CopperLine]

Good analysis, CopperLine.

But meanwhile, the wealthy non-EU-zone depositors (mostly Russians and Brits) will get to own some of Cyprus' banking sector.

It's a win-win day for bankers and the wealthy depositors.

Except the equity to be held by the depositors is worthless. After all, the depositors have been forced to exchange (real) cash for (unbacked) equity; it is equity in a bank which has been bankrupted in all but name.

[CopperLine]

A run on the banks when they open maybe restricted in two ways. The large deposit accounts that earn the highest interest usually require notice for withdrawals, some impose a penalty for early withdrawal. The banks may only allow limited withdrawals each day rather like they do with ATMs. I really can't see bank customers being hit again with another levy, that really would destroy confidence in banks worldwide.

Basically banking regulation during a crisis like this one is all about who is going to take the hit and how that hit is going to be delivered. The calculation in this Cyprus case - in which Christofias and Anastiades, as well as private finance and central bankers have all been complicit - has been that Cyprus will stabilise through this one hit against which Cyprus cannot fight back. Of course they've got to say that this is a 'one off levy', they can't say anything else. The moment it turns into a two hit attempt, then Cyprus' banks and all depositors are really screwed since the bluff will have been called.

Incidentally I don't think that this particular crisis will seriously affect the north or Turkey. However, both the north and Turkey are exposed to exactly the same kinds of pressures and systemic risk and for which they're no better prepared to deal with. It is just a question of time.

[Demonax]

Nicosia declares Tuesday a bank holiday, but ECB urges for action...

The Cypriot cabinet has declared Tuesday a bank holiday, for fear of capital flight, and this may even be stretched to Wednesday, as depositors are certain to withdraw huge sums from the Cypriot banks after the haircut imposed.

Nicosia postponed from Sunday to Monday the tabling in Parliament of the bill including the measures for the Cypriot bailout – including a bank account haircut and a tax hike on interest and corporate earnings – but the European Central Bank insists on a rapid voting because there are already signs a domino effect will follow across European lenders and markets from Monday.

There is genuine fear of market unrest on Monday morning when stocks may crumble in the eurozone and bank accounts in other southern European bank may suffer.

Skai radio reported on Sunday that the Bank of Greece has sent between 4 and 5 billion euros to Cyprus in order to help Cypriot banks respond to cash requirements by their clients.

http://www.ekathimerini.com/4dcgi/_w_ar ... 013_488273

[cyprusgrump]

Nicosia declares Tuesday a bank holiday, but ECB urges for action...

The Cypriot cabinet has declared Tuesday a bank holiday, for fear of capital flight, and this may even be stretched to Wednesday, as depositors are certain to withdraw huge sums from the Cypriot banks after the haircut imposed.

Nicosia postponed from Sunday to Monday the tabling in Parliament of the bill including the measures for the Cypriot bailout – including a bank account haircut and a tax hike on interest and corporate earnings – but the European Central Bank insists on a rapid voting because there are already signs a domino effect will follow across European lenders and markets from Monday.

There is genuine fear of market unrest on Monday morning when stocks may crumble in the eurozone and bank accounts in other southern European bank may suffer.

Skai radio reported on Sunday that the Bank of Greece has sent between 4 and 5 billion euros to Cyprus in order to help Cypriot banks respond to cash requirements by their clients.

http://www.ekathimerini.com/4dcgi/_w_ar ... 013_488273

Shit.

[sven]

A run on the banks when they open maybe restricted in two ways. The large deposit accounts that earn the highest interest usually require notice for withdrawals, some impose a penalty for early withdrawal. The banks may only allow limited withdrawals each day rather like they do with ATMs. I really can't see bank customers being hit again with another levy, that really would destroy confidence in banks worldwide.

Basically banking regulation during a crisis like this one is all about who is going to take the hit and how that hit is going to be delivered. The calculation in this Cyprus case - in which Christofias and Anastiades, as well as private finance and central bankers have all been complicit - has been that Cyprus will stabilise through this one hit against which Cyprus cannot fight back. Of course they've got to say that this is a 'one off levy', they can't say anything else. The moment it turns into a two hit attempt, then Cyprus' banks and all depositors are really screwed since the bluff will have been called.

Incidentally I don't think that this particular crisis will seriously affect the north or Turkey. However, both the north and Turkey are exposed to exactly the same kinds of pressures and systemic risk and for which they're no better prepared to deal with. It is just a question of time.

That is why it IS a loose loose situation, the TRUST has been lost, they will restrict you when it comes to how much of YOUR money you take out at a time, but take it out is what will happen and it won't matter that it is in smaller amounts.
Like I said earlier, they expected you the people to fall for the con, the people have not. The Bankers have become to complacent and under estimated the reaction, all that comes now is damage limitation.

[CopperLine]

Nicosia declares Tuesday a bank holiday, but ECB urges for action...

The Cypriot cabinet has declared Tuesday a bank holiday, for fear of capital flight, and this may even be stretched to Wednesday, as depositors are certain to withdraw huge sums from the Cypriot banks after the haircut imposed.

Nicosia postponed from Sunday to Monday the tabling in Parliament of the bill including the measures for the Cypriot bailout – including a bank account haircut and a tax hike on interest and corporate earnings – but the European Central Bank insists on a rapid voting because there are already signs a domino effect will follow across European lenders and markets from Monday.

There is genuine fear of market unrest on Monday morning when stocks may crumble in the eurozone and bank accounts in other southern European bank may suffer.

Skai radio reported on Sunday that the Bank of Greece has sent between 4 and 5 billion euros to Cyprus in order to help Cypriot banks respond to cash requirements by their clients.

http://www.ekathimerini.com/4dcgi/_w_ar ... 013_488273

Whether the banks open on Monday, Tuesday or whenever, the longer the delay in opening the banks the greater the panic and run. (It is not really "panic"; it is entirely rational behaviour to try to be the first leaver. Each step down the queue you are, the proportionately less chance that you'll be able to get your hands on your deposits). And because they've announced this 'levy' in this silly way - with increasing time between the announcement and the opening of the banks - they have to increase the value of cash which must be made available for those who wish to withdraw the remains of their savings, even with penalties. That means, in turn, that Cyprus' banks will have to load themselves up with extra cash. There's only one thing worse than this kind of levy for the banking system and that is that the banks themselves run out of cash. To avoid that worst prospect, this weekend and probably over the next few days, hundreds of millions of Euros in cash, if not billions will be shipped to Cyprus.

So keep an eye on those aircraft coming in from Greece in particular. Talk about "asset flight" !

[Demonax]

Reuters reporting that savers will be offered equity returns, guaranteed by future natural gas revenues.

"Half of the value of the haircut will be guaranteed by natural gas proceeds," the source told Reuters

.

[Demonax]

Whether the banks open on Monday, Tuesday or whenever, the longer the delay in opening the banks the greater the panic and run.

True. Note the reference to the ECB urging Anastasiades to not delay this vote. The ECB are clearly worried about contagion and bank runs elsewhere. A tactic by Anastasiades to delay things so that market panic might give him a better negotiating position? My advice is to delay as much as possible and let the markets go into free fall...

[Viewpoint]

Hate to say I told you so....

BUt here goes; I TOLD YOU SO

How that Karma just works its magic