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Haircut percentage in few months

08/04/2013 15:52
It will take months to complete the final amount of haircut on deposits in Bank of Cyprus, according to a Central Bank decree.

Speaking before the House Finance Committee, CB officer, Michalis Stylianou and referring to the valuation of the assets of Bank of Cyprus, said that under the law, valuators are selected when a bank is undergoing reorganization so as to valuate its assets and liabilities at fair value.

"In the memorandum, there is a provision until mid April to agree with the troika the terms of reference of the valuators and until next June to make the process of completing the work. Our goal is to go to offers to choose the house that will do this job”, he said.

Chairman of House Finance Committee and DIKO MP, Nicolas Papadopoulos wondered whether the 60% of deposits at Bank of Cyprus will remain blocked until September when the valuator’s work will be completed.

Mr. Stylianou said that based on the decree, this week 37.5% of the deposits will be converted into shares and will be submitted to a special account of the bank. “The final percentage of haircut will not be announced today”, he added.

CB Governor, Panicos Demetriades said that in order to de-freeze 10% of the deposits they gave a battle as the troika was opposed.

He also that it is unknown when the remaining 30% will be de-frozen.

Finance Minister, Haris Georgiadis said he is cautious to any additional exemption given for non haircut of deposits, stressing that the exemption given to insurance companies should be reconsidered.