Ivan Tchakarov, chief economist at the Moscow-based Renaissance Capital investment bank, said in a morning note to investors that if Cyprus were to impose capital controls, “Russian banks could face significant losses amounting to almost 2 percent of the GDP.”
Can Russia help bail Cyprus out?
Russia has loaned Cyprus money before. The island nation is now anxious to delay payments for a 2011 loan of €2.5 billion ($3.2 billion) it received from Moscow.
Cyprus is also seeking a new €2 billion loan from Russia. Putin has said Russia would be willing to help Cyprus once a European rescue package is in place, but many senior cabinet ministers have spoken strongly against lending money to Cyprus.
Finance Minister Anton Siluanov, who is expected to host his Cypriot counterpart on Wednesday for loan talks, said last week that Russia may in exchange ask Cyprus for information on the Cypriot companies registered by Russians.
Siluanov on Monday complained that Russia had not been informed of the decision to levy a tax on deposits despite an agreement for Russia and the EU to coordinate their efforts. Siluanov said that the ministry will have to reconsider whether to provide Cyprus with financial aid “in the light of the new situation.”
The article Russian Money in Cyprus Hit by Savings Seizure originally appeared on Fool.com and is written by Associated Press.
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