Speaking before the House Committee, Assistant Director of the Department of Supervision of the Central Bank of Cyprus, Michalis Stylianou, told MPs that by the 31st of July, the Bank of Cyprus is expected to exit its resolution regime.

In addition, he said that by that date, depositors will know which percentage of their 22,5% of uninsured deposits will be converted into shares and which will be returned to the depositors.

Following decisions by the Euro area Finance Ministers, collectively called as the Eurogroup, Cyprus will receive a €10 billion bailout from the ESM and the IMF after bailing in bank uninsured deposits in a bid to recapitalize the island`s troubled banks, which posted massive losses worth of €4.5 billion due to the Greek sovereign debt haircut.

The island`s second largest bank, Cyprus Popular Bank, is wound down and its good part - loans and deposits below €100,000 - is folded in to Bank of Cyprus (BoC).

So far 37.5% of uninsured deposits in BoC have been converted into equity, whereas an additional 22.5% remains frozen until the conclusion of an independent evaluation of the Bank`s balance sheet after absorbing the good part of the Cyprus Popular Bank. 

Source: Financial Mirror