In an interesting move earlier today, the Cypriot authorities and the EU-IMF agreed to impose a one-off bank tax on deposits in Cyprus as part of a wider economic rescue program. This €10 billion emergency deal puts a 9.9% tax rate on deposits of more than €100,000 and then targeting others who deposit less at the rate of 6.75% in an effort to pay off the bailout tab.
As of right now we have only received an official statement from Banc De Binary regarding how this matter will be handled for their current and potential clients which can be seen below.
Banc De Binary assures its clients that it will absorb any costs caused by the one-off bank deposit tax in Cyprus, and that all our client accounts and balances will be unaffected by the decision.
Your deposits are in safe hands, and we take this opportunity to thank our clients for their continued trust in our services and reputation.
Deposits in accounts outside Cyprus are not affected in any way.
Please do not hesitate to contact Customer Support if you have any questions or need additional information.
Banc De Binary Management
Sincerely,
Oren Laurent
President
Banc De Binary (www.bbinary.com)
It is still unclear whether or not the other binary options firms in Cyprus will follow the same route Mr. Laurent has taken and absorb the costs for their clients as it is quite large. If you are interested in reading a little more about the situation the New York Times has a great article you should check out here.
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Good one Banc De Binary.
The big question for all citizens of the world is which country will be next, since the precedent has been set and most countries are in a similar situation to Cyprus. Added to this whats to stop the thieves helping themselves again.
As this story develops its very likely there could be runs on banks in many other countries in Europe and around the world imo.
http://www.zerohedge.com/news/2013-03-16/saxo-bank-ceo-full-blown-socialism-and-i-still-cant-believe-it-happened
Authored by Lars Seier Christensen, CEO Saxo Bank; originally posted at his blog at TradingFloor.com,
It is difficult to describe the weekend bailout package to Cyprus in any other way. The confiscation of 6.75 percent of small depositors’ money and 9.9 percent of big depositors’ funds is without precedence that I can think of in a supposedly civilised and democratic society. But maybe the European Union (EU) is no longer a civilised democracy?
I heard rumours about this when I visited Limassol last week, but dismissed them as completely outlandish. And yet, here we are. The consequences are unpredictable, but we are clearly looking at a significant paradigm shift.
This is a breach of fundamental property rights, dictated to a small country by foreign powers and it must make every bank depositor in Europe shiver. Although the representatives at the bailout press conference tried to present this as a one-off, they were not willing to rule out similar measures elsewhere – not that it would have mattered much as the trust is gone anyway. It is now difficult to expect any kind of limitation to what measures the Troika and EU might take when the crisis really starts to bite.
If you can do this once, you can do it again. if you can confiscate 10 percent of a bank customer’s money, you can confiscate 25, 50 or even 100 percent. I now believe we will see worse as the panic increases, with politicians desperately trying to keep the EUR alive.
Depositors in other prospective bailout countries must be running scared – is it safe to keep money in an Italian, Spanish or Greek bank any more? I dont know, must be the answer. Is it prudent to take the risk? You decide. I fear this will lead to massive capital outflows from weak Eurozone countries, just about the last thing they need right now. Even from the EU as a whole, I suspect, as the banking union is in place in most countries already.
Another open question is what will happen to the huge number of brokerages based in Cyprus? There is about 100 or more FX and other brokers currently operating under the relatively light Cypriot regulation. How will this impact the trustworthiness of these many small institutions? What IS the exact impact on the client deposits they might be holding in Cyprus? Will anyone dare to do business with them going forward?
This is a major, MAJOR game changer and the fallout will be with us for a long time to come. I believe it could be the beginning of the end for the Eurozone as this is an unbelievable blow to the already challenged trust that might be left among investors. Talk about a possible own goal.
Market reaction? it must be very good for gold – and for safe-haven countries like Switzerland, Singapore and economically more healthy non-Euro countries in, for example, Scandinavia. I would think the EUR and associated markets will be undermined by increasing lack of confidence when the full implications become clear for investors.
This is full-blown socialism and I still cannot believe this really happened.
Lol, mob law.
looks like its going to be 20% now
http://rt.com/news/cyprus-bailout-tax-troika-730/
Make that 25% now for wealthy –
http://worldnews.nbcnews.com/_news/2013/03/23/17428178-cyprus-now-looks-to-take-25-percent-from-bank-accounts-of-wealthy?lite
They are up to 40% now
http://rt.com/business/bank-cyprus-cut-30-percent-deposits-789/
I wonder who is left to pay the salaries for the Cysec staff
It seems that all Binary Option platforms are being effected – Markets World have had to publish a couple of articles on Cyprus even tho they aren’t regulated there! http://articles.marketsworld.com/2013/03/26/markets-world-why-regulation-jurisdiction-matters/#.UWRvt5OfjrM