Cypriot banks are not at risk and there is no cause for concern after the turmoil caused by the crisis this week at Credit Suisse and the US Silicon Valley Bank before that.
This is what Central Bank of Cyprus Constantinos Herodotou has told both President Nikos Christodoulides and Finance Miister Makis Keravnos, Philenews reported on Friday.
Credit Suisse does not have a presence in Cyprus and banks have no interconnections with it, therefore there are no grounds for a disturbance of the island’s financial stability, the report also said.
In fact, the exposure of Cypriot banks to the Swiss bank’s bonds amounts to only €3 million.
And this is a negligible enough amount considering that in the 2013 banking crisis sparked by Greece’s debt haircut the exposure to Greek bonds was €5.7 billion.
Nonetheless, the risk of Credit Suisse collapsing and the immediate intervention of the Swiss state with €50 billion in financial support awakened dark memories of the 2008 haircut on deposits in Cyprus.
The financial crisis at the time followed the collapse of US Lehman Brothers bank which also affected Europe to a very big degree.