Cyprus:Deposit protection scheme should be respected

British Prime Minister David Cameron told Commons that London “made it very clear to the Cyprus government that when you have a deposit protection scheme, such as the one the UK and all of Europe have, it should be respected.”

He was referring to the Eurogroup decision on a one-off levy on all deposits in banks on Cyprus soil, including ones under the 100,000 euro guarantee limit. The proposed measure was rejected by the House of Representative sin Nicosia on Tuesday.

Responding to the Labour leader’s questions, the Prime Minister said that respect of such schemes for the protection of small savers was “the whole point”.

Ed Miliband also asked how much the UK government knew and when, to which Cameron pointed out that the UK is not involved in bailout discussions as it is not a euro member country. That’s the reason, he added, that the UK would not be contributing up to £1bn which it would otherwise have been liable to. The Labour leader commented that developments in Cyprus undermine trust in the European banking system.

Cameron also reiterated his government’s “absolute guarantee” that any Briton in Cyprus sent by the government would not lose out in terms of earning or savings.

“Nor would they be short of cash, thanks to the plane full of euros sent out to the island,” said David Cameron during PM`s question time in the House of Commons.
As for the thousands of British citizens in Cyprus, he said the government could not insure them against any losses in their local bank accounts. However, they would get the benefits and payments they were entitled to.