Financial Crisis

Bank of Cyprus customers will shed up to 60 percent of savings over 100 thousand euros, it has been revealed.

“The consequences of this haircut will create a vicious circle. The standard of living of Cypriots will change and it will affect the island’s financial industry,” said pensioner Frangkiskos Hadjifrangkiskos, in Nicosia.

Lawyer Irine Christodolou added: “This is completely unfair for the people because not everybody here is a Russian oligarch. Everybody is just very hardworking.”

It is the first time the euro zone has made bank customers contribute to a bailout.

Big depositors had been expected to take less of a hit, losing up to 40 percent of their savings.

The toughening of the terms will send a clear signal that the rescue plan means the end of Cyprus as a hub for offshore finance. It could also accelerate economic decline and bring more job losses.

Cypriot President Nicos Anastasiades said on Friday that the 10 billion euro bailout had contained the risk of national bankruptcy and would prevent the island from leaving the euro.