Cyprus` Central Bank (CBC) and the Troika Mission, after lengthy negotiations on Sunday, reached an agreement in principle on all issues concerning Cyprus` financial sector, CBC Spokesperson Aliki Stylianou told CNA.
Negotiations began at 15:00 local time (13:00 GMT) and concluded at 19:30.
As part of Cyprus’ application for financial assistance from the EU bailout mechanism, a Troika mission comprising representatives of the European Commission, the European Central Bank and the International Monetary Fund began their third visit to the island on Friday 9th November for negotiations with the authorities, both for the public sector as well as the island`s financial system.
“After arduous and lengthy consultations with the Troika mission, both on a head of mission level and on a technocratic level, the CBC has agreed in principle on all issues concerning Cyprus` financial sector,” she said replying to a CNA question.
Stylianou added that “this agreement lays the foundations for restoring the credibility and the stability of the financial system.”
“The recapitalisation of the financial sector and the consequent liquidity increase will lead to the reduction of interest rates and the satisfaction of the capital needs of the economy,” she said, adding that “these developments will affect economic growth positively.”
Cyprus on June 25 applied for financial assistance from the EU bailout mechanism (EFSF/ESM) to rescue its two largest banks which sought state aid, following a massive writedown of their Greek bonds holdings as a result of the Greek sovereign debt haircut.
