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Russia OK's $6.28 Billion Loan for Sinking Cyprus

Economically-strapped Cyprus, looking for bailouts, will reportedly get a 5 billion euros ($6.28 billion) loan from Russia, with which Greek Cypriot President Demetrias Christofias, a Communist educated in Moscow, has good ties, but the government has refused to confirm it. Cyprus is also seeking loans from the European Union.
The normally authoritative Politis daily reported Russia had approved a bilateral loan application from Cyprus some days ago, which would be disbursed to Nicosia in consultation with the International Monetary Fund, it added, without citing a source.
Asked to comment on the report, Finance Minister Vassos Shiarly told Reuters: “I am not aware of any developments with regards to the loan application from the Russian Federation.” Cyprus sought a financial lifeline from international lenders in July to buffer its two largest banks, which were hammered by their exposure to Greek debt earlier in the year.
Although it is in talks with international lenders from the EU, the IMF and the ECB, Cyprus had also previously applied to Moscow, a close business and political ally, for aid. Christofias was thought to be personally involved in efforts to secure a loan and had discussed it on one occasion with Russian President Vladimir Putin. Russia gave Cyprus a 2.5 billion euros loan in late 2011, after Nicosia΄s access to international capital markets was cut off because of high yields on its traded debt.
(Sources: Reuters, Capital)

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