Cyprus Economy Still At Risk From Bad Loans And Unemployment

A top European official this week defended the EU bailout of Cyprus, as rising unemployment and non-performing bank loans continue to pose risks to the island’s fragile economy.

Speaking in the capital Nicosia on 31 March, Eurogroup President Jeroen Dijsselbloem told reporters that last year’s closure of one bank, and the seizure of deposits in another, had been unavoidable. (MEES, 19 April 2013).

Mr Dijsselbloem’s one-day visit came 12 months after the shutdown of the island’s second-largest lender Popular Bank (known locally as Laiki Bank), and the use of large deposits to recapitalize Bank of Cyprus (BOC), in exchange for a €10bn international bailout. (CONTINUED - 1160 WORDS)