Cyprus bank depositors angry and frightened

Cypriots have been traumatised and fear this is the shape of things to come

An employee of Laiki Bank appeals for calm before the the bank reopened. Photograph: Reuters

An employee of Laiki Bank appeals for calm before the the bank reopened. Photograph: Reuters


Evripides is angry. He is a prosperous Cypriot businessman who handed over his firm to his son, but he pursues his own projects. Evripides has more than €100,000 in personal and business accounts in the two main banks to be restructured, Laiki and the Bank of Cyprus.

“I’m taking a haircut,” he says. “One-hundred thousand euro is not all that much. You can’t buy land, a house or start a business with €100,000. Some of the money I lost was for a project, now it’s finished.”

His wife, Artemis, had her savings in Laiki Bank but withdrew it some time ago to build an extension to their modest mountain home. Their daughter and son-in-law are keeping afloat in Greece.

Stella, a pharmacist, and Andreas, a teacher, share an account containing €300,000 with their two daughters. While they would lose only if the sum was more than €400,000, they also had €112,000 in a current account under the name of Andreas alone, to pay the running costs of building a house for the engaged daughter, as it is traditional in Cyprus for a girl to bring a house to a marriage.

“We don’t know if we can finish the house,” says Andreas. “We’re angry with the politicians and the bankers and disappointed in the troika. Our problems are not so much. We have our jobs; many will lose jobs as the economy is going down.”

‘Not much hope ’
Others have adopted the tenets of Zenon, the stoic philosopher born in 336 BC in the Cypriot port town of Larnaca.

Grey-haired Kyriakos Sarandis, an importer of electronic equipment for banks, says he will also suffer losses from his personal, business accounts and pension fund. “I have my money in Laiki and my mortgages in Alpha”, a solvent Greek bank.

“Now I don’t have the money to pay interest. This crisis will impact everyone. They will find a solution for the short term but I do not have much hope for the future,” he says.

Panicos Tremouris, sales manager for a chain of shoe stores, says the firm has loans at the, so far, viable Co-operative Bank. However, the firm’s operating money is in Laiki.

“My personal account is also in Laiki, but I have less than €100,000 because I had nine cancer operations in the past few years.”

He expects to see his business shrink.

“Who’s going to buy shoes? Adults, no. Parents for growing children have no choice. We had a meeting to discuss making redundant one of the two clerks we have in each shop but we decided to wait and see what will happen.”

Haircuts are not the only problem: fixed deposits cannot be touched before maturity, depositors cannot repatriate even modest sums. And people can take only €1,000 in cash when they leave or travel. Bags are being searched at the airport.

Fixed deposit
Young DVD shopowner Nikos

says “business has gone down for the past two years. I use all the money from the shop to keep up my collection”, now thousands strong.

“I have three accounts: one for business; one personal; and a fixed deposit. And I have two loans, a house where I live and a flat I rent.

“The €1,000 in my personal account pays the €950 for my loans. But what happens next month? Before the crisis I used to break my fixed deposit when I had an emergency. I would get out whatever I needed and pay the fine of €80-€90. Now we are not allowed to break fixed deposits. My tenant is in trouble and is asking for time to pay.”

Elena, a pretty Romanian who works in a grocery, is desperate.

“I work from five in the morning until nine at night. My husband has a job one day and not the next. We don’t have enough to live if he doesn’t work. My daughter is in school and needs special milk because she has allergies. We have €8,000 saved in the Co-op Bank but we can take out only €3,000 if we go home.”