Cyprus: Scrambles to Secure Funding

Members of the Cypriot Parliament met on Thursday in an emergency session as they attempted to find a way to raise enough capital to secure financing from the European Central Bank. The parliament has until Monday to reach an agreement with the European Union and International Monetary Fund or risk losing out on the low-interest loans that has been keeping them afloat. 

1.1 million people flocked to cash machines to withdraw their money after the government declared that the banks would not reopen until Tuesday. When they do reopen the banks will have a new set of rules to operate under in order to prevent a run on the bank. 

The European Union's conditions for financing have left Cyprus scrambling to find the €5.8 billion that Eurozone policymakers say they need. That amount would help recapitalize the banks and meet government commitments.

The Cyprus Parliament looked at a deal today that would overhaul its banking sector by breaking up the banks into good and bad banks. The plan would pool together state and church assets as well as real estate and pensions as a way to to unlock the €10 billion bailout. 

They were unable to come to an agreement today and have postponed debate on crisis measures until Friday.