40%... that is it? Back in the S&L crisis bank depositors over 100K lost everything. Having trouble believing the bondholders are totally protected and only 40% haircut for Jumbo accounts. This does not pass the smell test since they were considered bankrupt hours ago.
There’s the 40% haircut plus money from the ECB I believe.
Over 95% of the “bad bank” Laika bonds were already held by the ECB as collateral for Laika’s books and on the books of other banks, that’s part of the switch and bait parlor trick. The ECB will be nearly fully repaid for the impaired bonds over time, or there won’t be an ECB without further banking regulation consolidation.
Cyprus only has a population of 1.1 million people, in the bigger scheme of things they are just a very large municipal bankruptcy like the bankruptcy of Detroit, MI and Stockton, CA. Like Detroit, and the corruption in the GM bankruptcy, the time to pay the piper will occur decades after the current crop of politicians are retired, senile or deceased.
By that time, a cup of coffee in Cyprus will cost 20 Euros, and 15B Euros will seem trivial.