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Cyprus gets longer to repay Russian loan

Cyprus gets longer to repay Russian loan
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Russia has agreed to push back the pay-back date on a 2.5 billion euro loan it made to Cyprus two years ago. It has also reduced the interest.

That money was due to be paid back in five years, but now the maturity date has been extended to seven years. The interest rate has been cut from 4.5 percent to 2.5 percent.

That move was expected, but it is useful as it takes some pressure off Nicosia which also was forced to ask for a 10 billion euro bailout loan from the European Union and the International monetary fund.

Russia had spurned Cyprus’s plea for further help last month as it tried to stave off a financial collapse.

The then Finance Minister Michael Sarris had visited Moscow but came away empty handed. That was despite the fact that the EU/IMF loan meant that richer bank depositers in Cyprus – many of whom were Russians – had their accounts raided to help the island regain financial stability after it fell foul of the sovereign debt crisis.

It has also now been confirmed that Cyprus has complied with all the conditions set by the international lenders which means the first three billion euros of the 10 billion euro bailout can be released to Nicosia later in May.

Cyprus was the fifth country in the single currency area to seek eurozone financial help.