Capital controls stifle Cyprus as banks open

             

Cypriots streamed into banks on Thursday morning for the first time in two weeks, to find out whether their deposits had been reduced and to transact long overdue business.

Many came away with their business incomplete and their questions unanswered.

But strict controls on capital movements enacted by the finance ministry on Thursday mean that Angelos cannot remit overseas any amount above 5,000 euros ($6,410) without special permission from the Cypriot central bank.

All he was able to do was to leave money orders with Laiki Bank and hope for an answer in the days to come.

Neoklis, 31 and his brother Konstantinos, 37, have an even more serious problem.

They have 350,000 euros ($449,000) in deposits with the troubled bank, 250,000 ($320,600) of which is not covered by a Europe-wide banker’s guarantee.

That makes much of their savings vulnerable to a levy on all uninsured deposits at Laiki and the Bank of Cyprus, the country’s two biggest lenders.