Customers of the UK branch of Laiki Bank will have their savings deposits transferred to the wholly-owned UK subsidiary of Bank of Cyprus Public Company Limited.
In a statement, the Prudential Regulation Authority (PRA) announced that around 15,000 accounts with balances totalling an estimated £270 million will be moved to the Bank of Cyprus UK, allowing customers of the bank's UK arm to access their funds as usual.
The move will mean customers are excluded from any levies or withdrawal restrictions imposed on Cypriot banks as a result of the European bailout to save the country from going bankrupt last month.
The transferring of deposits means that savers' money up to the value of £85,000 will now be covered under the UK Financial Services Compensation Scheme (FSCS).
Laiki UK branch customers' mortgage and credit card advances will continue to be administered by the Laiki UK branch on behalf of Bank of Cyprus Public Company Limited.
Those with outstanding overdrafts will not have their money transferred and will instead have their accounts frozen, although it is understood that plans are being made to allow customers to apply for new overdrafts with Bank of Cyprus UK.
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