THE SUPREME Court yesterday began hearing 53 applications filed against last month’s Eurogroup decision to resolve Laiki Bank and force losses on uninsured depositors at the Bank of Cyprus.
The applications were filed by depositors who can expect to lose the entirety of their deposits over €100,000 at Laiki and between 40 to 60 per cent (potentially higher) of uninsured deposits at the Bank of Cyprus (BOC).
The eurozone finance ministers’ decision on March 25 provides for the restructuring of Cyprus’ two main banks, through the resolution of Laiki Bank and the recapitalisation of the Bank of Cyprus, resulting in a massive write off (haircut) of Cypriot and foreign bank deposits.
Since the controversial Eurogroup decision for a ‘bail-in’ of depositors at the two banks, uninsured deposits in both banks (over €100,000) have been frozen to resolve Laiki’s debts and recapitalise the BOC, with BOC depositors only allowed access to 10 per cent of their deposits so far.
It transpired during yesterday’s hearing that the effort by the plaintiffs’ lawyers to group their clients’ cases together failed, meaning that the Supreme Court will hear each of the 53 applications separately.
Regarding a request by the plaintiffs’ lawyers to postpone the hearing so they could access information requested of the Legal Service, Attorney-general Petros Clerides - representing the state - argued against a postponement, saying the resolution and recapitalisation of the two banks was a precondition for Cyprus to receive as a loan €10 billion from the troika.
Meanwhile, the data requested by the lawyers could not be given to the plaintiffs’ since the Central Bank had classified it as confidential, preventing even the Legal Service from having access to it.
The process will continue today and tomorrow.
Supreme Court President Petros Artemi yesterday excused himself from the proceedings, noting that he will soon enter into early retirement and will not be able to see out the hearings. He has been replaced as chair of the full bench of the top court by Judge Demetrios Hadjihambis.