ECB sets Cyprus funds deadline as Anastasiades brokers plan

Gas Deposits

Russian Prime Minister Dmitry Medvedev said today that Cyprus had “definitively rejected” the deposit levy.

The proposed investment fund would reduce the amount that Cyprus needs to raise from the bank-account tax, ANA reported, without saying where it got the information. It would include bond issuance and future revenue from gas deposits, the Greek state-run news agency said. The Cypriot central bank may contribute 560 million euros using gold reserves, ANA said.

Cyprus central bank chief Panicos Demetriades said in comments broadcast on state-run CYBC television today that he expects a bailout program to be approved by the ECB deadline.

If political leaders in Cyprus reach an agreement on a new proposal, a bill could be submitted to Parliament today, CYBC reported, without saying how it got the information.

‘Durable and Fair’

“The government of Cyprus needs to decide what it wants,” French Finance Minister Pierre Moscovici said today on RMC radio. “It needs to make a choice both for Europe and for its people to find a solution that is durable and fair.”

The Cypriot central bank has ordered lenders to remain closed through tomorrow. With a national holiday on March 25, account-holders therefore won’t have full access to their money before Tuesday.

In Moscow, Sarris said Cyprus was “asking for help clearly, but something that would make also economic sense for Russia,” including the extension of 2.5 billion-euro loan granted by Russia in December 2011.

Three Russian officials said Cyprus was also asking for a fresh 5 billion-euro loan. Sarris said on Antenna TV that Russia was unable to provide loans because of the uncertainty in Europe.

European officials have struggled to find an agreement that would rescue Cyprus, which accounts for less than half of a percent of the euro region’s economy, without unsettling investors in larger countries. Other elements of the rescue include asset sales and an increase in the corporate tax rate to 12.5 percent from 10 percent.

The proposed EU bailout of Cyprus is “absurd” and “surprising in its unpredictability and lack of consistency,” Medvedev said at a conference today in Moscow.

Bloomberg News

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