A TEAM of troika technocrats arrived in Cyprus yesterday to monitor developments in the island’s financial sector.The troika contacts will begin tomorrow with meetings with finance ministry officials, the Central Bank and management of commercial banks. The troika delegation departs on Saturday.The technocrats are on an “interim mission” to screen developments in the local banking sector. It’s understood they will be looking at steps taken so far to recapitalise the island’s largest lender Bank of Cyprus through a haircut on deposits.Cyprus has struck a deal with the troika to receive a €10bn bailout after bailing in bank uninsured deposits in a bid to recapitalise the island’s troubled banks... 10 comments

 LEGISLATORs will on Tuesday take a crunch vote to ratify – or not – a loan agreement between international creditors and Cyprus.The Financial Assistance Facility Agreement (FAFA) between the European Stability Mechanism on the one hand, and the Republic of Cyprus and the Cyprus Central Bank on the other, was approved by the cabinet on Wednesday. According to a legal opinion of the Attorney-general, the agreement is tantamount to an international treaty and must therefore be sanctioned by parliament.It’s understood the FAFA and the Memorandum of Understanding on Specific Economic Policy Conditionality concluded with international lenders will be bundled into a single document as a ratification law... 20 comments

 YEARS of omissions and delays have forced the government to submit provisional immovable property tax legislation (IPT) in a bid to meet immediate bailout conditions, but which will have to be amended by the end of June to make it fairer, spokesman Christos Stylianides said yesterday.The spokesman said authorities lacked sufficient data to prepare a comprehensive proposal but at the same time the bill had to be approved in the next few days for Cyprus to be eligible for the much-needed first tranche of a €10 billion bailout at the beginning of May. “Unfortunately, past omissions and shortcomings have resulted in insufficient data,” Stylianides said, adding that the government could not accept the current distortions in the system... 25 comments

 SEMI-state companies (SGOs) are looking into securing a €1.4 billion loan in a bid to avoid being privatised as part of the island’s €10 billion bailout.The proposal was tabled by the chairman of the telecommunications company CyTA and was discussed yesterday with the heads of the electricity authority (EAC) and the ports authority, among others. “These organisations belong to the people and should remain with the people,” CyTA chairman Stathis Kittis said. “I believe there are ways to mortgage the people’s property, instead of selling it, and provide the state a way out.Kittis said his proposal would be discussed by the boards of the various SGOs and then submitted to the government... 23 comments

SEMI-GOVERNMENT organisations (SGOs) have offered to come up with the money demanded by the troika in exchange for sparing them from privatisation. The Cyprus Telecommunications Authority (Cyta) and Cyprus Ports Authority (CPA) yesterday criticised the troika’s demands to come up with €1.4 billion through privatisations of SGOs, saying they believe they can use their own resources to cover the amount demanded by the troika as part of Cyprus’ bailout agreement.Speaking after a meeting of the House Finance Committee, Cyta chairman Stathis Kittis said privatisations were not necessary, especially those that contribute to state coffers. ... 22 comments

CYPRIOT MPs yesterday agreed to disagree with their German counterparts on the Cyprus-troika bailout deal, following a meeting of the House Finance Committee with visiting members of Germany’s lower legislative house, the Bundestag. A delegation of seven German MPs from across the political spectrum met with the Cypriot finance committee to discuss the pending €23 billion rescue package which still needs final approval from EU finance ministers followed by the endorsement of some national parliaments, including those of Germany and Finland. The German Bundestag is due to discuss the Cyprus rescue package, which includes a €10 billion bailout from the troika and a €13 billion Cypriot contribution or ‘bail-in’ next week... 23 comments

 THE CLINCHING of a final deal with the troika of international lenders on Tuesday sparked a fully-fledged blame game between ruling DISY, and opposition AKEL yesterday, even prompting President Nicos Anastasiades to join in.Each side blamed the other for the memorandum of understanding (MoU) and each said the other had brought the country to ruin. AKEL, when it was in government had agreed an initial MoU with the troika last November. The deal reached on Tuesday was with the new government led by Anastasiades. Each said the other’s deal was worse... 10 comments

THE GOVERNMENT yesterday clinched a deal with the troika on a €10 billion bailout programme with ‘better’ terms than the previous draft memorandum, said government spokesman Christos Stylianides.  “This is a very important development which ends a very long period of uncertainty,” he said, adding that the conditions have now been put in place to inject life back into the economy. The deal, which requires ratification from eurozone finance ministers and national EU parliaments, will see Cyprus receiving a €10 billion loan, carrying an interest rate of between 2.5 and 2.7 per cent. It is repayable over a 12 year period after a grace period of a decade... 26 comments

HAVING inherited a mess of an economy that very nearly bankrupted the country, the government is now trying to extract the best possible final terms of a bailout agreement with the troika of international lenders this week, the government spokesman said yesterday.“Having inherited an atomic bomb, the government managed to neutralise it and in doing so saved the country from total bankruptcy,” government spokesman Christos Stylianides told reporters yesterday after a Cabinet meeting.Stylianides said they were focusing on restarting the economy. Representatives of the Central Bank and Cabinet were due to meet last evening to finalise the government’s position ahead of a final consultation with the troika expected on Wednesday, Stylianides said... 2 comments

AUTHORITIES have struck a deal with troika late on Thursday not to write off current Bank of Cyprus (BoC) shares but to impose a write-down instead. The agreement provides for the replacement of the word “write off” with the word “write-down” in accordance with the bank resolution framework, the Cyprus News Agency said. The Eurogroup had decided on Monday that current shareholders will lose their shares without compensation and ownership of BoC will fall to uninsured depositors who will see around 40 per cent of their cash go towards rescuing the lender. The Church of Cyprus, a large shareholder in BoC, yesterday secured an injunction halting the decision... 5 comments