REUTERS
The Cypriot authorities plan to eliminate completely the existing restrictions on foreign bank transactions by the end of the current quarter, Governor of the Central Bank of Cyprus Chrystalla Georghadji said at a press conference following a visiting session of the Governing Council of the European Central Bank, which was held in the capital of Cyprus, Russian news agency TASS has reported.
"The introduction of capital controls was an inevitable measure, and had to be maintained until confidence in the country's banking system was restored," Georgadzhi said.
According to Georgadzhi, a decision on this issue will be made by the finance minister of Cyprus, after consultations with the central bank leadership.
Such strict measures were introduced in March 2013 in connection with the Euro group decision to carry out a "haircut" on deposits in the country’s leading banks as a condition for providing a bailout worth EUR 10 billion by the EU and IMF designed to rescue Cyprus from default.
Capital controls were also put in place to prevent capital flight from the island, which could ultimately destroy the country's financial system.
Over two years the banking restrictions have been gradually weakened, first for foreign banks and their customers, and then partially removed for transactions inside the country, with an increase in the ceiling on permitted asset withdrawal abroad, and conducting banking transactions by individuals and legal entities.