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Cyprus banks reopen with capital controls in place

FXstreet.com (Barcelona) - Cypriot banks have reopened on Thursday after remaining closed for 12 days and despite worries the situation seems to be calm for now. According to reports customers are forming orderly queues outside the banks and no signs of panic can be seen.

Yesterday the government in Nicosia released the details of the capital controls which will be imposed on transactions in order to prevent an outflow of money from the country. These include a limit on cash withdrawals of 300 euros per day, a ban on cashing cheques and restrictions on using Cypriot credit cards abroad. The European Commission backed the move, emphasizing however that the measure should be lifted as soon as possible.

According to an article in Der Siegel, the ECB has sent 5 billion euros to Cyprus to help the country’s banks cope with an increased demand for cash.

Meanwhile, the entire board of the Cypriot Laiki Bank, which will be closed down under the rescue deal, submitted their resignations on Thursday morning.

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