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Saturday, November 18, 2017

Cyprus' largest bank dominated by Russia's rich

Russians who lost their deposits in the Bank of Cyprus under the EU's 2012 bailout conditions got shares in return and ended up being its majority shareholders.

When Cyprus went to the EU to ask for a bailout, Brussels, acknowledging that European taxpayers were increasingly concerned about paying for the southern part of the continent, decided to impose a burden on the banks that were responsible for the financial crisis.

Brussels agreed to help Cyprus but with harsh conditions. The EU, European Central Bank and International Monetary fund demanded a cut on deposits of more than $136,000 in its largest lender, the Bank of Cyprus, in return for $13.6 billion to be paid out until 2016.

To compensate for their losses, the investors received shares. That meant that almost overnight the majority of shares was in the hands of foreigners, mainly Russians.

In September, six Russians were appointed to the 16 member board of directors of the bank.

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