People queue outside a Laiki bank branch in the Cypriot capital of Nicosia, yesterday, as they wait for the bank to open after an unprecedented 12-day lockdown.
NICOSIA: Cypriots stayed calm as banks reopened yesterday after a nearly two week lockdown, with tight capital controls stopping customers from draining the island’s coffers after its eurozone bailout.
President Nicos Anastasiades tweeted his thanks to the people of the eastern Mediterranean island for their “maturity”, with fears of a catastrophic run on banks that have been closed since March 16 proving unfounded.
Dozens of people formed orderly queues and then filed inside when the doors finally swung open at 12:00pm (1000 GMT), while security guards posted outside most branches found they had little to do.
Some customers were seen depositing cash rather than making withdrawals.
Banks were handing customers lists of the controls including a daily withdrawal limit of ¤300 ($385), a ban on the cashing of cheques and orders not to take more than ¤1,000 out of Cyprus.
World markets remained jittery over the crisis, which has seen capital controls imposed for the first time by a eurozone economy in order to prevent meltdown after the ¤10bn ($13bn) EU-IMF rescue package.
“There is confidence, everything was fine,” unemployed electrician Philippos Philippou said as he emerged from a branch of Laiki bank, which will be wound up under the bailout.
Five shipping containers reportedly filled with billions of euros were delivered to the central bank late Wednesday, guarded by a helicopter and police cars.
The Cyprus stock exchange remained closed.
Officials had said the capital controls were needed to prevent the “collapse of credit institutions” and further damage to the fragile Cypriot economy, which is heavily dependent on a banking sector bloated with Russian money. But after the banks reopened Anastasiades, who was only elected one month ago, gave “sincere thanks and deep appreciation” to Cypriots for not panicking at a “critical time” for the economy.
“The attitude of maturity and responsibility the people have demonstrated today, going to bank branches, sends a clear message of optimism and certainty for the future and to those who have been watching events internationally,” he said in a statement.
There were queues of up to 25 people at other banks and most had between one and three guards posted at their entrances, some of them carrying weapons — an alien sight in the generally peaceful tourist island.
Roula Spyrou, 50, a jewellery shop owner, said she would not bother going.
“There’s going to be queues so I’m not going to spend so many hours there to get ¤300,” she said.
Cyprus is the first eurozone country to impose capital controls after bailouts — unlike Greece, Spain, Portugal and Ireland, which have also received multi-billion-dollar rescue packages.
As well as raising concerns that other countries could face similarly harsh bailouts in future, the move has raised fears that it could effectively create “two euros” as euros trapped in Cyprus are effectively worth less. But the European Commission yesterday said there was “a matter of overriding public interest” in imposing the controls to maintain the stability of the financial system and of Cypriot banks. AFP
