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Author: Alexander George Michaelides Publisher: World Scientific ISBN: 178326876X Category : Business & Economics Languages : en Pages : 365
Book Description
"On June 28th 2012, the small island of Cyprus became the fifth government to request an economic bail-out from the Eurozone after losing access to international capital markets. Less than a year later, a €10 billion second rescue deal was agreed upon -- an unprecedented agreement that bailed in creditors of Cyprus' two largest banks, and triggered an economic crisis that the nation still struggles to recover from today. This resourceful collection of essays provides a thorough and in depth analysis of how Cyprus reached the point of failure and what lessons this experience holds for future economic crises. The various perspectives collectively address unanswered questions, including whether the bail-in can be considered successful, why the recession was less severe than expected, and what conclusions can be drawn about stress-testing exercises across borders. Focusing on one of the (proportionately) largest crises in financial history, the case study will prove essential to policy-makers and politicians, especially in the euro area."--Provided by publisher
Author: Alexander George Michaelides Publisher: World Scientific ISBN: 178326876X Category : Business & Economics Languages : en Pages : 365
Book Description
"On June 28th 2012, the small island of Cyprus became the fifth government to request an economic bail-out from the Eurozone after losing access to international capital markets. Less than a year later, a €10 billion second rescue deal was agreed upon -- an unprecedented agreement that bailed in creditors of Cyprus' two largest banks, and triggered an economic crisis that the nation still struggles to recover from today. This resourceful collection of essays provides a thorough and in depth analysis of how Cyprus reached the point of failure and what lessons this experience holds for future economic crises. The various perspectives collectively address unanswered questions, including whether the bail-in can be considered successful, why the recession was less severe than expected, and what conclusions can be drawn about stress-testing exercises across borders. Focusing on one of the (proportionately) largest crises in financial history, the case study will prove essential to policy-makers and politicians, especially in the euro area."--Provided by publisher
Author: Alexander Michaelides Publisher: World Scientific ISBN: 1783268778 Category : Political Science Languages : en Pages : 365
Book Description
On June 28th 2012, the small island of Cyprus became the fifth government to request an economic bail-out from the Eurozone after losing access to international capital markets. Less than a year later, a €10 billion second rescue deal was agreed upon — an unprecedented agreement that bailed in creditors of Cyprus' two largest banks, and triggered an economic crisis that the nation still struggles to recover from today.This resourceful collection of essays provides a thorough and in depth analysis of how Cyprus reached the point of failure and what lessons this experience holds for future economic crises. The various perspectives collectively address unanswered questions, including whether the bail-in can be considered successful, why the recession was less severe than expected, and what conclusions can be drawn about stress-testing exercises across borders.Focusing on one of the (proportionately) largest crises in financial history, the case study will prove essential to policy-makers and politicians, especially in the euro area.
Author: Stavros A. Zenios Publisher: ISBN: Category : Languages : en Pages : 1
Book Description
The Cyprus crisis is one of the most complex in the Eurozone - although in absolute terms it is a minor crisis. An analysis of the ongoing developments from different perspectives leads to the conclusion that we are witnessing a perfect storm of a financial crisis at the confluence of sovereign debt and banking crisis together with debt overhang of business and households and a severe decline of competitiveness. As a result Cyprus has amassed a large external debt that cannot be repaid, no matter what fraction of the country's real domestic economic output is appropriated through austerity measures. Hence, fiscal austerity leads to deflationary stagnation and alone does not work. We advocate a policy response that addresses multiple dimensions of the problem with policy options of (1) austerity deleveraging, (2) structural reforms, (3) financial innovations, (4) selective privatizations and (5) debt restructuring. These options are drawn from lessons of what worked well, and what not, in crises of other countries and these lessons are summarized in lieu of conclusions. A postscript discusses the potential impact of the Eurogroup decision of March 2013 on the Cyprus crisis.
Author: John Theodore Publisher: Springer ISBN: 1137452757 Category : Business & Economics Languages : en Pages : 196
Book Description
The 2012-2013 economic crisis in the Republic of Cyprus is commonly attributed to a number of factors, including the exposure of Cypriot banks to over leveraged local property companies; the knock-on effect of the Greek government debt crisis; and international credit rating agencies downgrading the Cypriot government's bond credit status. What followed was unexpected and controversial: a bailout on condition of a one-time bank deposit levy on all uninsured deposits in the country's second-largest bank, the Cyprus Popular Bank; and on the uninsured deposits of large proportion of the island's largest commercial bank, the Bank of Cyprus. Many have questioned the implications of Cyprus' ties with the Russian financial system, as well as the draconian and unprecedented bailout terms imposed on the Cypriot population by the Eurozone. There has been little written from the Cypriot perspective on these events. This book presents a study of the events surrounding the recent Cypriot Financial Crisis and its impact on the Eurozone. It incorporates insights from leading protagonists in the Cypriot government and banking sectors and focuses on qualitative research to assess the events that formed the backdrop of the crisis. The book analyzes the policies of many public and private institutions and presents the crisis alongside other Eurozone bailouts to compare and contextualize the ongoing issues. Cyprus and the Financial Crisis also explains the political and historical backdrop of the events, including the wider Cypriot experience since the 1974 invasion, and the unravelling financial relationship between Cyprus, Greece and Russia. It incorporates the views of Cypriots from a wide and diverse spectrum, and presents the resilience of the island in fighting back to beat forecasts for recovery, helped by the Eldorado of gas finds off its southern shores.
Author: International Monetary Publisher: International Monetary Fund ISBN: 1616358416 Category : Business & Economics Languages : en Pages : 49
Book Description
In tandem with Eurozone financial market developments and the prevalence of negative interest rates in 2020, Cypriot banks passed through the costs of their liquidity to their customers, reducing the attractiveness of placing PDMO cash surpluses in domestic bank deposits. Suitable investment alternatives to central bank deposits for the PDMO’s liquidity buffer are scarce, given negative yields on other Eurozone sovereign and agency issues. This situation is shared by the PDMO with almost all of its Eurozone peers. While this is likely to persist in the short term, it should not preclude establishing a framework governing the PDMO’s investment policy or a suitable set of guidelines.
Author: Publisher: ISBN: 9789295085336 Category : Languages : en Pages : 419
Book Description
This book tells the inside story of those who played key roles in setting up the organisations and combatting the crisis. In exclusive interviews, global financial leaders and ESM insiders provide a rich stock of perspectives and anecdotes that bring to life the urgency of the crisis as well as the innovative solutions found to resolve it. The European Stability Mechanism and its temporary predecessor the EFSF provided billions of euros in loans to five hard-hit euro area countries during the European financial and sovereign debt crisis of the early 2000s, helping to safeguard the stability of those countries and the euro area as a whole. Initially, the crisis-torn euro area was ill-equipped institutionally, but the rapid establishment of the firewalls, the assistance programmes, deep‐seated country reforms, the strengthening of European institutions, and extraordinary European Central Bank measures shielded Europe from a euro area break-up. With the EFSF/ESM set-up, its managers aspired to create a new, more entrepreneurial international financial institution, one that is agile enough to respond quickly to new challenges, while still ensuring the strict governance befitting an organisation pursuing a public mission. The euro area has emerged from near disaster in more robust shape. As Europe strives to further strengthen its architecture in preparation for any possible future crises, it is important to reflect upon how the euro area reinvigorated its fortunes and draw the relevant lessons for future crisis management in Europe and beyond.
Author: International Monetary Fund. European Dept. Publisher: International Monetary Fund ISBN: 1484387430 Category : Business & Economics Languages : en Pages : 16
Book Description
This Selected Issues paper identifies key challenges among households in reducing nonperforming loans (NPL) further in Cyprus, namely, low repayment capacity, particularly among a certain group of debtors; and weak repayment discipline owing to strategic behavior. Despite some revival of lending activity, the role of bank credit as a funding source remains limited. External inflows, drawdown of savings, use of own funds, and unpaid debt service obligations are contributing to financing economic activities, but these sources may not be sustainable over the medium term. Addressing NPLs to lower borrowing costs and reviving credit supply will be important for supporting longer-term growth. Since 2017, bank credit has provided only a moderate amount of new financing. The reduction in credit-to-GDP ratio has been almost entirely achieved by NPL write-offs and sale or transfer of loans out of the banking system, and through denominator effect. As of 2017, credit demand appears moderately strong, in line with robust economic growth, while credit supply remains broadly unchanged, reflecting continued risk averseness by banks. These trends suggest that while deleveraging is expected to continue through clean-up of bank balance sheets, growth in credit flows (pure new loans) are likely to remain at a moderate level until NPL recovery and repayment discipline improves significantly.
Author: Efrosyni Panayi Publisher: ISBN: Category : Languages : en Pages : 24
Book Description
The complexity of the Cyprus crisis makes answering the question of the title difficult, while the policy implications make the question important. However, the answer to this question unavoidably points the finger to those responsible, and as a result the quest for an answer is clouted by political considerations. In this paper we use a systematic analysis of the data to find answers. Relying on literature of Early Warning Systems we build a model to determine: (1) When did it become apparent that the Cyprus economy was headed for a crisis, and (2) Could the crisis have been averted if either public finances or banking sector balance sheets were managed differently? The results show, first, that there were indeed early warning signals for the crisis. These came as early as 2009-2010, much before the Cyprus sovereign was cutoff from international markets. Second, there were signals for a banking crisis starting in 2009-2010, and signals for a sovereign debt crisis starting in 2010-2011. Both sovereign and banks were headed for a crisis, independently of each other, although, of course confounding factors were also present.
Author: International Monetary Fund. European Dept. Publisher: International Monetary Fund ISBN: 1513522043 Category : Business & Economics Languages : en Pages : 81
Book Description
This 2019 Article IV Consultation with Cyprus discusses that following a period of very rapid growth in the aftermath of the economic crisis, growth is gradually settling in at a more sustainable but still relatively robust pace despite the external slowdown. Output is projected to rise by around 3 percent in 2019–20, supported by construction and services sectors. Good progress has been made in addressing domestic and external stability risks arising from legacies of the financial crisis. Sales of nonperforming loans (NPLs), amendments to the foreclosure and insolvency framework and resolution of a large systemic bank have helped strengthen bank balance sheets. Reversal of reforms to the foreclosure framework would hinder ongoing NPL resolution efforts and create risks for financial stability. Realization of contingent liabilities from the still weak banking sector or increased fiscal spending pressures could undermine investor confidence, raising interest costs and depressing growth. Cyprus needs to build on recent gains by advancing reforms to secure macroeconomic stability, enhance efficiency and strengthen productivity and growth potential.
Author: International Monetary Fund Publisher: International Monetary Fund ISBN: 1451809980 Category : Business & Economics Languages : en Pages : 60
Book Description
This paper discusses key findings of the Financial System Stability Assessment on Cyprus. The assessment reveals that the banking system of Cyprus has managed to avoid the worst effects of the global financial crisis, but stress tests confirmed that credit risk remains high. The assessment suggests that work on the crisis contingency framework should be completed. Various European Union (EU)-wide and national initiatives are already under way, including strengthening deposit insurance, drafting guidelines for emergency liquidity assistance, and adopting a legal framework for covered bonds to facilitate access to European Central Bank refinancing.
Author: Alexander George Michaelides
Author: Alexander George Michaelides
Author: Alexander Michaelides
Author: Stavros A. Zenios
Author: John Theodore
Author: International Monetary
Author: 
Author: International Monetary Fund. European Dept.
Author: Efrosyni Panayi
Author: International Monetary Fund. European Dept.
Author: International Monetary Fund