Cypriot parliament approves ‘solidarity fund,’ allows capital controls

breaking_news.siIn a bid to secure an EU bailout, the Cypriot parliament has adopted laws creating a “solidarity fund” to pool assets as the basis for an emergency bond issue and allowing the government to impose capital controls for the country’s banks.

Nicosia introduced emergency legislation in the parliament late on Thursday to secure a bailout package from the international lenders as the island nation verges on bankruptcy.

The nine bills presented include plans to recapitalize its banking sector, eight times the size of Cyprus’ €17 billion economy, and lay losses on big depositors.

On Monday Cyprus will still need to reach a deal with the eurozone and the International Monetary Fund before the ECB carries out its threat to withdraw liquidity support.

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