Cyprus Bailout Swells To $30 Billion
By JUERGEN BAETZ
BRUSSELS (AP) â¿¿ The cost of bailing out Cyprus has swollen to 23 billion euros ($30 billion), with the crisis-hit country having to take on the lion's share of the measures needed to avoid bankruptcy, according to a draft document by the country's international creditors.
The draft document, obtained by The Associated Press on Thursday, says the country will have to find 13 billion euros ($17 billion) â¿¿ an increase on the 7 billion euro contribution agreed during the country's chaotic bailout talks last month. The money will be raised by imposing heavy losses on large bank deposits, levying additional taxes, privatizations and a part-sale of the central bank's gold reserves.
"The sheer size of the increase has underlined the extent of the enormous challenges facing Cyprus itself," Jonathan Loynes of Capital Economics said in an analyst note.The so-called troika of international creditors â¿¿ the European Commission, the European Central Bank and the International Monetary Fund â¿¿ are set to grant the Mediterranean island nation 10 billion euros ($13 billion) in rescue loans to recapitalize its shaky banking system and keep the government afloat. For its side of the deal, Cyprus was supposed to contribute 7 billion euros to the rescue. In the latest draft document, however, the troika has revised the overall cost of bailing out Cyprus amid a gloomier economic outlook for the country, adding an extra 6 billion euros to the bill. The Cypriot government blamed the gulf between the original total and the new 23 billion euro bill on the previous leftwing administration and the time it took to properly negotiate a bailout â¿¿ delays which pushed the cost of recapitalizing its banks much higher. Government spokesman Christos Stylianides accused former President Dimitris Christofias of failing to "take responsibility and complete indecisiveness" in promptly negotiating a bailout.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV