CYPRUS: DEPOSITORS MIGHT BE ISSUED BANK STOCK WORTH 37.5% OF AMOUNTS OVER 100,000 EUROS, “WHILE THE REST OF THEIR DEPOSITS MAY NEVER BE PAID BACK”

Reblogged from: http://www.cryptogon.com/?p=34315

CYPRUS: DEPOSITORS MIGHT BE ISSUED BANK STOCK WORTH 37.5% OF AMOUNTS OVER 100,000 EUROS, “WHILE THE REST OF THEIR DEPOSITS MAY NEVER BE PAID BACK”

March 30th, 2013

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Via: Reuters:
Big depositors in Cyprus’s largest bank stand to lose far more than initially feared under a European Union rescue package to save the island from bankruptcy, a source with direct knowledge of the terms said on Friday.

Under conditions expected to be announced on Saturday, depositors in Bank of Cyprus will get shares in the bank worth 37.5 percent of their deposits over 100,000 euros, the source told Reuters, while the rest of their deposits may never be paid back.

The toughening of the terms will send a clear signal that the bailout means the end of Cyprus as a hub for offshore finance and could accelerate economic decline on the island and bring steeper job losses.

Officials had previously spoken of a loss to big depositors of 30 to 40 percent.