Endangered Cyprus Gets Lifeline As Govt Decides on a 20% Tax on Savers

Cypriot politicians were unable to enjoy the Saturday Sun in the troubled mediterranean Island as the country suffers from a truly troubled economic state. The EU gave Cyprus an ultimatum, ‘raise Euros 5 billion and only then will we support you with a Euros 10 billion

package’ by Monday.

The government, locked behind closed doors for the last week has decided on an interim solution that might just save the once offshore tax haven state to keep its position as a EU member and be part of the single currency pact.

And the verdict is….

A massive 20% tax on savers with deposits over 100,000 euros at the Bank of Cyprus.

&

A formidable 4% tax on deposits over 100,000 euros for investors with funds at other banks.

Brussels has given Cyprus until Monday to raise the funds, EU leaders will be holding talks tomorrow (Sunday) to measure up the ‘solution’ Cyprus managed to muddle up today.

The Euro closed at 1.2989 against the Green back on Friday.

Earlier in the week, Cyprus’s finance minister tried his luck with friends in Moscow, however the minister returned empty-handed.

Ratings agency Moody’s added salt to the wounds of Cyprus by downgrading the deposit and senior unsecured debt ratings of; Bank of Cyprus, Cyprus Popular Bank and Hellenic Bank, the banks suffered relegation from Caa2 to Caa3.

Cyprus has become an alternative jurisdiction for financial services firms looking to gain exposure to Europe. Several derivatives brokers set up shop under CySEC CySEC The Cyprus Securities and Exchange Commission (CySEC) is a financial regulatory authority of Cyprus. CySEC is one of the key watchdog authorities for brokerages in Europe, whose financial regulations and operations comply with the European MiFID financial harmonization law.Founded in 2001, CySEC is instrumental in providing licensing and registration for forex brokers and previously binary options providers.CySEC is responsible for a variety of different functions, which includes the supervision The Cyprus Securities and Exchange Commission (CySEC) is a financial regulatory authority of Cyprus. CySEC is one of the key watchdog authorities for brokerages in Europe, whose financial regulations and operations comply with the European MiFID financial harmonization law.Founded in 2001, CySEC is instrumental in providing licensing and registration for forex brokers and previously binary options providers.CySEC is responsible for a variety of different functions, which includes the supervision Read this Term, Cyprus Forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term and CFD brokers have created their own FX eco-system in the region. Cypriot banks have been struggling on the back of the Greek debt crisis.