NEWS

Cyprus ‘no template’ for future eurozone bailouts, says ECB’s Draghi

European central Bank President Mario Dragi said on Thursday that Cyprus’s initial decision to charge a levy on insured as well as uninsured banks depositors was a mistake.

“That was not smart, to say the least, and was quickly corrected,» he said.

Draghi also told a news conference that Cyprus’s bailout, including hitting wealthy depositors with losses, was not what would happen in further bailouts.

“Cyprus is no template,» he said.

The euro zone struck a deal last month to hand Cyprus a bailout worth 10 billion euros ($12.84 billion) but demanded

rich depositors in its banks forfeit some money despite the risk of a wider bank run.

Initially, Cyprus also sought to charge those with 100,000 euros or less even though they had a bank deposit guarantee.

[Reuters]