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Moody's: Cyprus' proposed bank fund is too small

Moody's: Cyprus' proposed bank fund is too small

Moody's says a proposed bank stability fund for banks in Cyprus is too small to cover the possible needs of the island's banking system if it runs into trouble.
The government is proposing a two-year 0.05 percent tax on commercial bank deposits over (EURO)100,000 ($142,000) projected to raise (EURO)120 million ($170 million). Some (EURO)70 million ($99.3 million) would go into state coffers and the rest into the stability fund.
Moody's Investors Services said Monday that the amount for the stability fund is "insignificant" relative to the banking system's possible needs given total assets of about (EURO)110 billion ($156 billion) _ or 6.5 times the islands' gross domestic product.
Moody's said about (EURO)2.7 billion ($3.8 billion) is needed.


Updated : 2021-03-06 01:22 GMT+08:00