Clear 48° Good Afternoon
Clear 48° Good Afternoon

A sense of relief as Cypriot banks reopen

Customers wait patiently in lines as Cyprus’ banks

Customers wait patiently in lines as Cyprus’ banks reopen on Thursday, albeit with a limit of $384 withdrawal for individuals. (March 28, 2013) Photo Credit: Bloomberg

NICOSIA, Cyprus - Anxious Cypriots patiently waited in long lines to get at their accounts Thursday after banks opened for the first time in nearly two weeks, following an international bailout to save the country's financial system.

Fearing a run on its banks, the tiny Mediterranean country has imposed daily withdrawal limits of $384 for individuals -- the first so-called capital controls that any country has applied in the eurozone's 14-year history.

Financial strains are building on families and businesses, and the recession in Cyprus is likely to deepen. The mood outside banks was calmer than feared. Many people said the withdrawal limits were probably necessary to keep a bad situation from spiraling out of control.

Flower shop owner Christos Papamichael was among some 30 people waiting patiently for bank doors to open at noon Thursday. "Everything has been paralyzed . . . No one thinks of buying flowers," he said.

Banks had been shut in Cyprus since March 16 to prevent people from draining their accounts as politicians scrambled to save the country's stricken financial sector. ATMs were working, but with a limit on daily withdrawals.

An initial plan to seize up to 10 percent of all Cypriot bank deposits caused an international uproar and was scrapped. But to secure 10 billion euros ($12.9 billion) in loans from other euro countries and the International Monetary Fund, Cyprus agreed Monday to wind down its second-largest bank and seize billions from accounts holding more than the insured limit of 100,000 euros ($128,000).

More news