Dimitris Katsikas: Insisting on the Same Recipe: A First Assessment of the Cyprus Bailout Deal

On early Monday, March 25, we witnessed the latest in a series of “rescue” deals for European countries in crisis. Following another dramatic meeting of the Eurogroup, it was announced that the countries of the Eurozone had agreed on a €10 billion loan programme for Cyprus. However, this bailout package came at a high price: Laiki Bank (the second largest bank of the island based on assets) will be broken into a “good” and a “bad” bank; the “good” bank will be absorbed by the Bank of Cyprus (which is the largest bank of the island), whereas the “bad” bank will be wound down.

full text