Gold Magazine May - June 2013, Issue 26 | Seite 30

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BANKING

HOW CYPRUS HAS CHANGED THE
RULES OF THE BANKING GAME AT
HOME AND IN EUROPE
By Kyproula Papachristodoulou

D

espite the fact that
European officials
have been trying extremely hard to isolate
the storm caused by
the financial prescription given in the case of Cyprus, there can be
no denying that the Eurogroup’s decision of
25 March 2013 has changed the rules of the
banking game in Europe. And that’s not all:
it has also significantly altered the way EU
sovereign creditors value EU commitments; it
has overcome various obstacles preventing the
exchange of information for tax purposes, not
only among the eurozone countries but also
those of the EEA. And it seems to have altered
the speed at which decisions are taken regarding the infamous “banking union”.
As Lee Buchheit, one of the world’s leading experts on sovereign debt restructurings
told Gold, “I don’t think there can be much
doubt that the bail-in of uninsured depositors
in Cyprus opens a new chapter in the management of the eurozone debt crisis.” Buchheit, a
partner based in the New York office of Cleary
Gottlieb Steen & Hamilton LLP and one
of those who helped mastermind the Greek
haircut, told Gold that until that point (i.e. the
Eurogroup summit on 16 March) “the eurozone official sector had made a point of insisting that the senior creditors of eurozone banks

(senior bondholders [