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Bank of Cyprus UK savers 'not affected by levy'

Bank of Cyprus UK savers 'not affected by levy'

Category: Savings

Updated: 19/03/2013
First Published: 19/03/2013

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Bank of Cyprus UK has confirmed that its customers will not be affected by the one-off levy to be paid by Cyprus's savers, which will form part of the country's bailout package.

The confirmation comes after news yesterday that the ailing Cyprus Government will only be eligible for a £8.7-billion European Union bailout if it initiates a one-off levy on all deposits held in Cypriot banks.

The proposal, to be discussed by the Cypriot parliament this week, would see those savers with less than 100,000 euros hit with a 6.75% levy, while those with over 100,000 euros will be charged 9.9%.

Savers in Britain with deposits held with the UK arm of Bank of Cyprus have been assured that their deposits will not be affected by this one-off levy.

This is because Bank of Cyprus UK is registered and authorised by the Financial Services Authority, with savings of up to £85,000 protected by the UK's Financial Services Compensation Scheme.

Laiki Bank UK has also moved to assure customers banking with its UK subsidiary that they will not be affected by the levy.

"We have clarified with the Cyprus authorities that this levy, as proposed in the draft law, will have no effect on customer deposits held with the Overseas Branches of Cyprus Banks," a statement on its website read. "To this extent your deposits held with Laiki Bank UK will not be affected."

However, unlike Bank of Cyprus UK, deposits with Laiki Bank UK are protected by the Cyprus Deposit Protection Scheme, up to a maximum of 100,000 euros (£86,000).

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