Parliament passes Solidarity Fund Budget

4

By Stelios Orphanides

Parliament approved on Friday a supplementary budget which provides for the allocation of €25 million in taxpayers’ money to the (National) Solidarity Fund to compensate bondholders and depositors of Laiki Bank, the Cyprus New Agency (CNA) reported.

Following a proposal from Speaker Demetris Syllouris, the amount was earmarked for further consideration pending a debate on the change of the purpose of the fund. The parliament rejected a proposal by Green lawmaker Giorgos Perdikis for an express debate.

The cabinet decided three months before the presidential elections to use the Solidarity Fund, which was initially set up immediately after the 2013 banking crisis to help recapitalise banks. The budget was passed with 21 votes in favour and 17 abstentions.

The Solidarity Fund has currently €10m in reserves.

Investors who bought contingent convertible bonds issued by Bank of Cyprus and Cyprus Popular Bank in the years preceding the 2013 banking crisis, lost €1.5 billion when they were converted into equity. Still, this was insufficient to prevent Laiki from going out of business and Bank of Cyprus had to convert almost half of its customers’ uninsured deposits into equity to remain afloat. Depositors at both banks lost €8bn

Share.

About Author

Stelios Orphanides is a journalist at CyprusBusinessMail.com. To contact Stelios Orphanides: [email protected]

  • Bob Ellis

    What happened to the old solidarity fund where Nicolas Shacolas the village idiot €330,000 in cash in 2013 ? just google ‘christofias solidarity fund 522000’.
    By a strange co incidence this was just days before the President illegally signed of the golf complex. proposed at Limni, Polis. He signed of 3 years of bureucracy, checks and diligence in one day. The golf complex in question is being developed by a certain group of companies owned by a family called Shacolas…… I guess immunity form prosecution does have it’s advantages.

  • almostbroke

    Taxpayers money to compensate ‘gamblers ‘ who lost in the Banks , no problem the taxpayer ‘ponies up ‘ for everything , that is those who pay tax usually the ‘little ‘ people .

  • A is B

    Those that lost their savings should be compensated.

  • clergham

    Good that someone at least does not use the ridiculous ‘House’ moniker