Greek Cypriot president in bailout battle issues 'quit' threat

Greek Cypriot president in bailout battle issues 'quit' threat

NICOSIA - Agence France-Presse
Greek Cypriot president in bailout battle issues quit threat

Protesters hold a banner that reads 'Hands off Cyprus' during an anti-bailout rally outside European Union house in Nicosia on March 24. Greek Cypriot politicians turned to the EU on March 24 in a last-ditch effort to help the island nation forge a viable plan to secure an international bailout. AP photo

Greek Cypriot President Nicos Anastasiades warned lenders on March 24 that their demands in make-or-break Brussels bailout talks might force him to quit, the island's state media reported.

"Do you want to force me to resign?" the Cyprus News Agency quoted Anastasiades as telling EU and IMF chiefs as negotiations on the punishing terms of a deal to rescue the island's eurozone economy dragged on towards a Monday deadline.

"If you want that, tell me," he told them, CNA said, citing sources at the presidential palace in Nicosia where party bosses are receiving regular briefings on developments in the talks.

"I am giving you one proposal, and you do not accept it. I give you another and it's the same. What else do you want me to do?" he is quoted as saying, in a sign of high tensions and lack of progress in Brussels.

The president complained in particular about EU and IMF demands over the future of Bank of Cyprus, which he said would bankrupt the island's largest lender were they implemented.

CNA said that Anastasiades had a 1900 GMT telephone call with parliament speaker and acting president Yiannakis Omirou, who heads the socialist EDEK party, but did not specify whether he was the source of the purported comments.

The conservative president, who won an election just a month ago, has faced massive political opposition on the island and daily protests against the terms being demanded in return for a bailout of up to 10 billion euros ($13 billion).

The Nicosia offices of his Disy party were daubed with graffiti on March 23 night reading "Thieves" and "Get Out." It was rapidly cleaned off and police briefly deployed around the building to be replaced later by security guards.

Disy holds just 20 of the 56 seats in parliament and needs the support, or at the very least the abstention, of other parties to pass any legislation required by any bailout deal. He also needs to secure some political cover from other factions.

Two banks slash ATM withdrawal limits

Meanwhile, the two main banks at the center of Greek Cyprus' financial crisis slashed the daily cash withdawal limits from ATM machines on March 24, state media reported. With queues growing outside cash machines across the island, Laiki (Popular) Bank cut maximum withdrawals at ATMs to 100 euros a day while the Bank of Cyprus reduced its limit to 120 euros a day, the Cyprus News Agency said.

Laiki bank, Cyprus's second biggest lender, had already restricted withdrawals to 260 euros a day on March 21 after its ATMs were besieged by customers drawing their previous daily limits of 700 euros.

The Mediterranean island faces a possible exit from the euro, with the European Central Bank due to halt funding on March 25. The country's banks are not due to reopen until March 26 after a 10-day shutdown.

Parlaiment has already passed legislation to put all Laiki deposits over 100,000 euros into a "bad bank" where they will be tied up for years and may never be fully recovered.

But negotiations have stumbled on EU-IMF demands for a substantial levy on deposits above the same threshold in the Bank of Cyprus to avoid it facing similar restructuring. The island's largest lender, it holds more than a third of all deposits.