Brussels, 17/07/2014 (Agence Europe) - The Cypriot authorities are reported to have revived their request from a long time ago for emergency liquidity for the country's banks at a meeting on 16 July with the head of the European Central Bank, Mario Draghi.
At the meeting, the Cypriot president, Nicos Anastasiades, is reported by Bloomberg to have brought up the idea of converting some of the Emergency Liquidity Assistance Liability of the country's biggest bank, Bank of Cyprus (BoC), into long-term debt, as was granted to Ireland in 2013. This is not the first time this has been requested - it was requested in a letter from Anastasiades in June 2013. In 2013, the Cypriot president argued that BoC had been forced to take on €3.8 billion of unsecured ELA debt from the country's second-largest bank, Laiki. Anastasiades explained: 'Bank of Cyprus itself has a total ELA liability of around €2 billion. By taking an additional €9 billion from Laiki, which was accumulated over the course of the last year under very questionable circumstances, BOC has substantially increased the vulnerability of its own funding structure, with its cumulative ELA liability reaching a very high €11 billion.' After the meeting between Anastasiades and Draghi, the Cypriot government simply commented: 'They also discussed ways to provide further support, with the ECB assuming a decisive role.' (EL)