Anastasiades gave the interview in Milan, on the sidelines of a summit between European Union and Asian leaders.

He said that once the country has tightened foreclosure legislation in a bid to help banks tackle mounting distressed loans, as demanded by the international creditors who financed a €10 billion emergency rescue loan last year, Cyprus will be in a position to sell more debt.

But he was quick to clarify that the goal of an early exit would not involve ignoring the terms of the bailout agreement.

“What we want is, through adhering to our commitments, to achieve an exit from the bailout programme at the earliest possible time,” Anastasiades was reported as saying, adding that Greece and Cyprus are “two dissimilar cases.”

Greece’s announcement earlier this month that it wants to exit its own adjustment programme ahead of schedule seems to have backfired badly, as its 10-year bond yield spiked to its highest level in two years earlier this week, which is why Anastasiades was anxious to make the distinction.

“There’s a different situation that prevailed and continues to prevail in Greece,” he said.

But although Anastasiades confirmed plans to exit its programme – due to last into 2016 – sometime next year, he declined to flesh out the timeline, arguing that the priority is to bolster the government’s credibility by fulfilling the current aid conditions.

That is currently in limbo, as a disagreement between the government and parliament over the terms of foreclosure legislation, due to be resolved late in October, is holding up the review process by the EU-IMF – and the next tranche of about €430 million in aid to Cyprus.

“We would already be at that stage (of selling more debt) if we didn’t have this delay related to the outstanding issue on foreclosures,” Anastasiades said.

Anastasiades said Cyprus would be prepared to sell bonds right after any completion of the pending review, “as long as market conditions permit.”

At 45%, Cypriot banks currently struggle with the highest percentage of distressed loans in Europe, making the need for tougher foreclosure rules all the more dire as they undergo European stress tests.

Anastasiades predicted that any difficulties arising from the stress tests would be “manageable.”

Source: Cyprus Mail