Cyprus banks re-open; limits on transactions

Nicosia (AP): Banks in Cyprus reopened to customers for the first time in nearly two weeks today, albeit with strict restrictions on transactions, after being closed to prevent people withdrawing all their savings during the country's acute financial crisis. Large lines had formed outside the banks ahead of the opening of banks for six hours from noon. Systems were frozen ahead of the start of business, and guards from a private security firm reinforced police outside some ATMs and banks in the capital, Nicosia. Branches of the country's troubled second-largest lender, Laiki, didn't open on time due to a delay in the bank's computer system. Laiki spokesman Costas Archimandrites said there had been an initial issue with the bank's system but that 80 per cent of branches had opened after about half an hour. At one branch in central Nicosia which was still shut nearly an hour later, an employee emerged from the bank and pleaded for patience with the line of about 50 people. Most waited calmly, although some began to complain about being made to wait. Banks in Cyprus have been shut since March 16 to prevent people draining their accounts as politicians scrambled to come up with a plan to raise enough funds for Cyprus to qualify for €10 billion ($12.9 billion) in bailout loans for its stricken banking sector. The deal was finally reached in Brussels early Monday, and imposes severe losses on deposits of over €100,000 in the country's two largest banks, Laiki and Bank of Cyprus. Laiki will be broken up, with its good assets being absorbed by Bank of Cyprus. The exact amounts of the losses have not yet been officially announced. No checks can be cashed, although they can be paid in, and people leaving the country can only take up to 1,000 euros, or the equivalent in foreign currency, with them in cash.