Cyprus President Nicos Anastasiades Slams IMF and EU Bailout Conditions

Cypriot President Nicos Anastasiades unleashed a scathing attack on the bailout conditions placed on the country, by the International Monetary Fund, European Central Bank and European Union, saying that there was not enough "careful preparation."

According to a letter from Anastasiades to the IMF, ECB and EU, known as the Troika which granted Cyprus a €10bn (£8.5bn, $13.3bn) rescue package this year, the President slammed the stringent bank deposit conditions by saying that it has done more harm than good.

He also added that its neighbour Greece received more lender support, whereas Cyprus has not and bailout conditions were placing a stranglehold on the economy.

"It is my humble submission that the bail-in was implemented without careful preparation," said Anastasiades in the letter.

Cyprus is one of the smallest Eurozone economies but secured a rescue package if it met severe banking restrictions and adhered to a set of austerity measures.

It is the first country in the bloc to go through a 'bail-in' process, where thousands of depositors lost their savings, as a result of new enforced banking conditions.

In order to receive its bailout, Cyprus had to raise €5.8bn in a short amount of time, or face being kicked out of the single currency.

Subsequently, it had to shutdown Popular Bank, also known as Laiki, in order to shore up the cash in time.

Bank of Cyprus is also assuming some of Laiki's assets and was therefore forced to assume Laiki's emergency liquidity assistance (ELA) liability.

It then meant that the country had to convert substantial deposits, held in the Bank of Cyprus, into equity to help recapitalise that bank.

Anastasiades also slammed the difference in terms of support that Cyprus has had compared to Greece.

"As understandable as ring-fencing may be, this was absent at the time of deciding the Greek PSI (Private Sector Involvement) in relation to Greek government bonds which cost Cyprus 25% of its GDP," said Anastasiades in the letter.

"The heavy burden placed on Cyprus by the restructuring of Greek debt was not taken into consideration when it was Cyprus's turn to seek help."