People are rushing to withdraw their savings from the bank in Cyprus after an EU/IMF bailout agreed on Friday imposed levy on bank deposits of up to 10 per cent on bank deposits.
The €10bn bailout will result in people with less than €100,000 in their accounts paying a one-off tax of 6.75 per cent, while those with deposits over that threshold will pay 9.9 per cent. Depositors will be compensated with the equivalent amount in shares in their banks.
The deal requires the approval of the country’s parliament. An emergency session and presidential address due to take place today have been postponed until tomorrow, according to the BBC.
The Mail on Sunday reports that up to 60,000 British savers could lose money as a result. However, appearing on The Andrew Marr Show this morning, Chancellor George Osborne confirmed that Brits in Cyprus on military or government service would be protected from the levy.
He also wasted no time in pointing to the crisis in Cyprus as proof that Britain can’t “change course” from his economic plan.