Cyprus caps withdrawals on eve of reopening banks

Several other controls set to deter any panic

NICOSIA, Cyprus — Banks in Cyprus are to open for the first time in more than a week today, but restrictions will be in place on financial transactions to prevent people from draining their accounts.

Among the capital controls, cash withdrawals will be limited to $383 per person each day. No checks will be cashed, although people will be able to deposit them in their accounts, according to a ministerial decree that was released late Wednesday.

The controls will be in place for four days.

Cyprus's banks were closed on March 16 as politicians scrambled to come up with a plan to raise $7.5 billion so the country would qualify for $12.9 billion in much-need bailout loans for its collapsed banking sector. The deal was finally reached in Brussels early Monday, and imposes severe losses on deposits of more than 100,000 euros in the country's two largest banks, Laiki and Bank of Cyprus.

Since Monday's deal, Cypriot authorities have been rushing to introduce measures to prevent a rush of euros out of the country's banks when they do reopen.

Other capital controls include a cap of 5,000 euros on transactions with other countries, provided the customer presents supporting documents. Payments above that amount will need special approval. Travelers leaving the country won't be able to take with them anything greater than 1,000 euros in cash.


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