Cyprus, current state of play
Here is the current state of play regarding today’s vote, information from various local sources:
Session starts at 4pm local (GMT+2)
Cypriot Parliament: 56 seats
Anastasiades party ΔΗΣΥ (DISI): 20 seats
ΔΗΚΟ (DIKO) (coalition party): 8
ΑΚΕΛ (AKEL): 19
ΕΔΕΚ (EDEK): 5
ΕΥΡΩΚΟ (EUROKO): 2
Ironically, one of Anastasiades’s MPs is on a trip to Argentina – out of all places – rushing back for the vote.
Out of coalition party’s ΔΗΚΟ MPs, 5 expected to vote Yes, 2 undecided, 1 was against as of yesterday.
ΔΗΚΟ wants guarantees of ECB’s support of the banking system and commitment on the part of the troika that no added austerity measures will be required. The latter not going to happen.
27 out of 28 opposition MPs are expected to vote No: ΑΚΕΛ, ΕΔΕΚ, Greens, Independent MP, 1 ΕΥΡΩΚΟ MP.
There is a possibility that other ΕΥΡΩΚΟ MP and party president will vote Yes.
Total Yes votes can range between 27 and 30.
Central Bank is prepared for both eventualities. Widely reported that it has already secured 5 billion euros to address the expected withdrawals from the banking system.
This is the Central Bank’s depositor protection scheme. Note the scheme is designed per depositor – not deposit – per bank. A shared account of 200,000 euros in one bank translates into an aggregate of 100’000 euros per depositor and is considered protected.
No matter what today’s outcome, Cyprus’ banking system will not be the same ever again. If Germany’s intention was to reduce the size of it – closer to the eurozone average – they managed to achieve that with a masterful stroke in just one weekend.
Deposits flight combined with the sale of the Greek operations will probably leave the Cypriot banking system half the size it was on Friday night, even left with one systemic bank after restructuring.
Cannot see a smooth transition period without some form of capital controls.
By the time the dust settles, the Cypriot economy will sink and PIMCO’s adverse scenario will materialise. Many people did their best to make this a reality.