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11.03.2014 - 16: 08

Eurogroup approved a new tranche of credit assistance to Cyprus

Eurogroup on Monday decided to grant Cyprus's fourth tranche of credit assistance in the amount of € 150 million

Funds will be transferred to the Cypriot authorities in early April after the approval of the Board of Governors of this step of the European Stability Mechanism. At the same time anti-crisis aid to Cyprus in the amount € 86 million to allocate and the International Monetary Fund (IMF).

Green light to provide a new tranche was given at a meeting in Brussels of finance ministers of the euro zone. They were informed of the "troika" of international lenders (the EU, the European Central Bank and the IMF) about the results of last month, the next check run by the Cypriot authorities financial stabilization program. Agreement on its terms was reached in March 2013 year. "Troika" then agreed to provide financial assistance to Cyprus in the amount of € 10 billion in exchange for the program of austerity measures and structural reforms, especially in the banking sector. They included a "haircut" of uninsured deposits at the Bank of Cyprus and the Cyprus Popular Bank, as well as the union of these fininstitut followed by termination of the existence of the latter.

During inspections lenders focused on the course of bank restructuring and privatization program of state enterprises. While carrying through Parliament a law on denationalization process they set as a condition for a new tranche. The Government of Cyprus has fulfilled this point in the program, with difficulty achieving approval of the bill on February 4 deputies background held mass protests and strikes the largest SOEs.

In a statement, the Eurogroup, paid tribute to the Government of Cyprus for what it is "reasonable budget performance has continued that along with less deep than expected recession to achieve its budgetary targets on 2013 year with considerable margin." "We welcome the signs of increasing macro-financial stability as the implementation of the program - said in a statement. - We also welcome the steps already made the transition to the second stage of gradual easing of restrictive measures on payment flows, which was marked by the removal of restrictions on deposit. "

Nevertheless, the Eurogroup warned that the Cyprus economy continues to face serious challenges. In this regard, "must continue to maintain fiscal discipline and at the same time to make additional efforts to create conditions for sustainable growth," the statement said.

A source:

Tags: Cyprus, European Union, Economy, Credit, Help, Banks