After being closed since March 15 during Cyprus’ economic crisis amid fears depositors would rush to withdraw their money, 312 branches of Cypriot banks in Greece were back in operation on March 27 after being taken over by the Greek-owned Piraeus Bank.
Long queues formed immediately as, despite Greek government guarantees that their deposits were safe from a confiscation tax being imposed there that many, besides collecting salaries and pensions, reportedly made large withdrawals or cleaned out their accounts.
Piraeus Bank acquired the branch network by paying the equivalent of 524 million euros ($670.5 million.) The agreement relates the acquisition of all the deposits, loans and branches of the Bank of Cyprus, of the Cyprus Popular Bank, also known as Laiki Bank and which has shut down for good, and of the Hellenic Bank in Greece, including the loans and deposits of their subsidiaries in Greece (leasing, factoring and Investment Bank of Greece-IGB).
Piraeus now is the second-largest lender in Greece, with 1,660 branches and 2,400 employes, and assets of 95 billion euros, ($121.54 billion.) Greek Finance Minister Yiannis Stournaras insisted that the Cypriot deal would not be extended to other countries and that Greek deposits wouldn’t be touched by the government. Cyprus is seizing 80-100 percent of uninsured accounts over 100,000 euros ($130,00).
“The Eurozone is not insecure,” Stournaras said in response to a journalist’s question. “In fact, it was stated clearly at the Eurogroup that the solution chosen applies to Cyprus and not any other country.”
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