Cyprus troika review starts with talks on capital controls, bank restructuring

A delegation from the troika of international lenders on Tuesday began its fourth assessment of Cyprus’s economy and troubled banking system to see whether Nicosia is meeting its obligations under the bailout.

Cyprus has completed three similar reviews by the troika, which is made up of the European Commission, European Central Bank and International Monetary Fund.

The latest examination will focus on bank restructuring, a proposed national health scheme and dealing with nonperforming loans.

A statement from the Cyprus central bank said troika technocrats will stay until May 12 and that on Tuesday there were “general discussions” on capital controls, and bank restructuring.

Last week, Nicosia lifted all major domestic capital controls, such as the cashing of checks, put in place more than a year ago to prevent a run on the banks.

In previous reviews the government has been praised for sticking to a harsh bailout adjustment program agreed last year with the troika.

Nicosia has said it will adhere to the bailout no matter how unpopular it is, but the troika will also look at revenue-raising measures and how effective they have been.

[AFP]