Cyprus: from boom to bail-in

SummaryThis is a case study of how a country nearly reached bankruptcy in March 2013, within five years of entering the eurozone. The magnitude of the requested assistance is extremely large relative to GDP (100%) and studying this event provides useful lessons for avoiding such crises in the future...

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Main Author: Alexander Michaelides
Format: Article in Journal/Newspaper
Language:unknown
Subjects:
Iceland
Online Access:http://hdl.handle.net/10.1111/1468-0327.12040
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description SummaryThis is a case study of how a country nearly reached bankruptcy in March 2013, within five years of entering the eurozone. The magnitude of the requested assistance is extremely large relative to GDP (100%) and studying this event provides useful lessons for avoiding such crises in the future. The crisis resulted from a worsening European economic environment (especially in Greece), bad choices with regards to public finances, weak corporate governance within the local banking sector, inadequate and/or difficult regulation of cross-border banking, worsening competitiveness, and bad political decisions at the European and, especially, the local (Cypriot) level. Local politics, reflected in short-term political calculations and/or inadequate understanding of the magnitude of the crisis, delayed corrective action for 18 months until election time, making a bad situation almost impossible to deal with. Overconfidence can be one behavioural explanation for why local politicians ignored the dramatic costs of inaction.— Alexander Michaelides
format Article in Journal/Newspaper
author Alexander Michaelides
spellingShingle Alexander Michaelides
Cyprus: from boom to bail-in
author_facet Alexander Michaelides
author_sort Alexander Michaelides
title Cyprus: from boom to bail-in
title_short Cyprus: from boom to bail-in
title_full Cyprus: from boom to bail-in
title_fullStr Cyprus: from boom to bail-in
title_full_unstemmed Cyprus: from boom to bail-in
title_sort cyprus: from boom to bail-in
url http://hdl.handle.net/10.1111/1468-0327.12040
genre Iceland
genre_facet Iceland
op_relation http://hdl.handle.net/10.1111/1468-0327.12040
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spelling ftrepec:oai:RePEc:oup:ecpoli:v:29:y:2014:i:80:p:639-689. 2024-04-14T08:13:53+00:00 Cyprus: from boom to bail-in The “greatest” carry trade ever? Understanding eurozone bank risks A pyrrhic victory? Bank bailouts and sovereign credit risk The real effects of sovereign debt downgrades Investigation report into holdings of Greek government bonds Bank of Cyprus – Marfin Popular Bank Group: review of cross-border merger Efficient use of information and social value of information Beware of German gifts near elections: how Cyprus got here and why it is currently more out than in the Eurozone Tax evasion across industries: soft credit evidence from Greece Gambling for Resurrection in Iceland: The Rise and Fall of the Banks Capital controls and the resolution of failed cross-border banks: the case of Iceland Systemic risk, sovereign yields and bank exposures in the euro crisis Supervising cross-border banks: theory, evidence and policy The problem of holdout creditors in eurozone sovereign debt restructurings What drives financial complexity? A look into the retail market for structured products Banking globalization and monetary transmission Cyprus pays for its own failures The limits of transparency Five lessons from the Spanish cajas debacle for a new euro-wide supervisor Sovereign default, domestic banks and financial institutions Why is Manhattan so expensive? Regulation and the rise in house prices Fiscal policy and asset prices with incomplete markets Procyclicality and financial regulation A macroprudential approach to financial regulation Regulatory arbitrage and international bank flows Bank regulation, credit ratings and systematic risk Independent Commission on the Future of the Cyprus Banking Sector: Final report and recommendations Cyprus: first review Cyprus: an analysis of the impact of the resolution methodology on stakeholders’ claims including the emergency liquidity assistance The end of bank secrecy? An evaluation of the G20 tax haven crackdown Cyclical implications of Basel II capital standards Winners and losers in housing markets The European sovereign debt crisis New evidence on the interest rate effects of budget deficits and debt Offshore jurisdictions (including Cyprus), corruption money laundering and Russian round-trip investment What happened in Cyprus? The adverse effects of systematic leakage ahead of official sovereign debt rating changes “When the cat's away the mice will play”: does regulation at home affect bank risk-taking abroad? What happened in Cyprus? The economic consequences of the last communist government in Europe Efficient recapitalization Independent due diligence of the banking system of Cyprus The countercyclical capital buffer of Basel III: a critical assessment A gap-filling theory of corporate debt maturity choice The banking system in Cyprus: time to rethink the business model? Monetary policy strategy and the euro: lessons from Cyprus Call me maybe? The effects of exercising contingent capital Handling of the emergency liquidity assistance of Laiki Bank in the bailout package of Cyprus Fairness and sustainability for Cyprus The Cyprus debt: perfect crisis and a way forward Fairness and reflexivity in the Cyprus bail-in Alexander Michaelides http://hdl.handle.net/10.1111/1468-0327.12040 unknown http://hdl.handle.net/10.1111/1468-0327.12040 article ftrepec 2024-03-19T10:38:24Z SummaryThis is a case study of how a country nearly reached bankruptcy in March 2013, within five years of entering the eurozone. The magnitude of the requested assistance is extremely large relative to GDP (100%) and studying this event provides useful lessons for avoiding such crises in the future. The crisis resulted from a worsening European economic environment (especially in Greece), bad choices with regards to public finances, weak corporate governance within the local banking sector, inadequate and/or difficult regulation of cross-border banking, worsening competitiveness, and bad political decisions at the European and, especially, the local (Cypriot) level. Local politics, reflected in short-term political calculations and/or inadequate understanding of the magnitude of the crisis, delayed corrective action for 18 months until election time, making a bad situation almost impossible to deal with. Overconfidence can be one behavioural explanation for why local politicians ignored the dramatic costs of inaction.— Alexander Michaelides Article in Journal/Newspaper Iceland RePEc (Research Papers in Economics)

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