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Cyprus banks to re-open under tight security after 12-day lockdown

Cyprus banks to re-open under tight security

An armed police officer guards several container lorries arriving at the country's Central Bank in Nicosia, Cyprus, on Wednesday

Armed police were on guard as container lorries presumably carrying cash arrived at the Central Bank on Wednesday evening
Security is tight in Cyprus as banks prepare to reopen nearly two weeks after closing while a controversial bailout was negotiated.

Armed police were on guard as lorries said to be loaded with cash arrived at the central bank on Wednesday night.

Demonstrators took to the streets to protest against the bailout plan and strict capital controls.
The restrictions on the free movement of capital represent a profound breach of an EU principle, correspondents say.

Cyprus is the first eurozone member country to bring in capital controls.
Customers will be limited to withdrawing 300 euros ($383; £253) a day, to prevent everyone fleeing with their savings.

Depositors with over 100,000 euros will also see their savings taxed in exchange for bank shares as Cyprus seeks to raise 5.8bn euros to qualify for a 10bn-euro bailout from the European Union, European Central Bank and the International Monetary Fund, the so-called troika.

An earlier plan to tax small depositors was vetoed by the Cypriot parliament last week.
Run fears
Correspondents say some fear a stampede as banks in Cyprus reopen between noon and 18:00 local time (10:00-16:00 GMT), nearly two weeks after they closed and progressively stricter limits were placed on withdrawals at cash machines.

Armed police are on guard and hundreds of staff from the private security firm G4S will be guarding bank branches and helping to transport money, said the AP news agency.

The BBC's Paul Mason: "Every figure in this document has the word 'euro' and two x's"

Severe new rules have been imposed on money movements to prevent a torrent of money leaving the island and credit institutions collapsing.

As well as the 300-euro daily withdrawal limit, Cypriots may not cash cheques. They can spend up to 5,000 euros on debit and credit cards.

Payments of over 200,000 euros require prior approval by a specially established committee - only the Cypriot government and its Central Bank are excluded.

There is a cap of 5,000 euros on transactions with other countries and travellers leaving the country will only be allowed to take 1,000 euros with them.


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