Abstract
We were certainly expecting the resolution actions to be challenged in court, but not so soon. On Wednesday, 27 March, in the early afternoon, I was informed by our lawyers that the Greek Orthodox Church of Cyprus —which happened to be the largest single shareholder of Bank of Cyprus —had obtained an interim court injunction stopping the application of the bail-in tool to the shares of the bank.
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Notes
- 1.
See pages 85–86 in PIMCO (2013) ‘Independent Due Diligence of the Banking System of Cyprus ’. Downloadable from: http://www.centralbank.gov.cy/media/pdf/cyprusindependentduediligencereport_18april.pdf.
- 2.
Rachel Cooper, ‘Cyprus archbishop urges Eurozone exit’, The Telegraph, 25 March 2013. See: http://www.telegraph.co.uk/finance/financialcrisis/9951813/Cyprus-archbishop-urges-eurozone-exit.html.
- 3.
See, for example, Jeff Black ‘How Trading Blame led to Death Threats for ECB ’s Cypriot Banker’, Bloomberg , 29 May 2013. https://www.bloomberg.com/news/articles/2013-05-29/how-trading-blame-led-to-death-threats-for-ecb-s-cypriot-banker.
- 4.
See Appendix 1.
- 5.
This was probably because he had wanted to fill it himself. However, by annulling the appointment, because of its alleged unconstitutionality, he was unable to replace Stavrinakis with someone else.
- 6.
Unlike the central bank, the Cyprus Securities and Exchange Commission ’s budget has to be approved by the Ministry of Finance and Parliament. Moreover, the Chair of the CySEC can be removed from office by the government much more easily than the central bank Governor, whose independence is protected by the constitution and the EU Treaty.
- 7.
The ECB returned to the matter in letters to the government but also in a new legal opinion—ECB. (CON/ 2013/78)—issued in 22 November 2013 on further proposed changes to the CBC law relating to bank licensing (to extend the scope of decisions controlled by the board): ‘The ECB refers to its Opinion CON/2013/41 on changes to the governance of the CBC , which concerns previous amendments to the Law on the CBC. A number of observations made in that Opinion were not taken into account and the ECB invites the relevant Cypriot authorities to address them in this draft law’.
Bibliography
PIMCO (2013) Independent Due Dilegence of the Banking System of Cyprus, February. Available from: http://www.centralbank.gov.cy/media/pdf/cyprusindependentduediligencereport_18april.pdf.
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Appendix
Appendix
Opinion of the European Central Bank of 5 June 2013 on changes to the governance of the Central Bank of Cyprus (CON/2013/41).
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Demetriades, P. (2017). Toxic Fallout. In: A Diary of the Euro Crisis in Cyprus. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-62223-1_15
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DOI: https://doi.org/10.1007/978-3-319-62223-1_15
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