Brit expats in Cyprus fear post Brexit loss of bank savings

Published:  10 Jun at 6 PM
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Amongst the endless debates about the ramifications of a Leave vote, British expats living in Cyprus now have a new concern about the possible fate of their bank deposits.

In spite of the thousands of media pages both on and offline devoted to examining and re-examining the plight of British expats in Europe in the event of a Brexit, one topic has been ignored. Expats in Cyprus, however, still remember the 2013 bail-in which resulted in the confiscation of legally held bank deposits totalling over $100,000. In addition, over the years UK deposits have been affected by Icesave and the banking scandals involving the Royal Bank of Scotland, Lloyds and Northern Rock.

Neither the UK government, the Remain or Leave campaigns nor the many financial experts interviewed by the media have thought to mention the security of funds held by expats in Cypriot bank accounts. Worse still, UK compensation for lost deposits has now been reduced to £75,000 due to a European Deposit Guarantee Directive requirement, the euro equivalent of which is $100,000.

Comments by the Bank of England concerning the possible effects of a Brexit have not touched on the safeguarding of deposits held in overseas UK bank branches or European banks. Nor has the actual legality of non-EU citizen-held bank accounts in EU member states been mentioned, causing expats to be concerned about the continuance of their pension payments to UK banks overseas.

Recent research identified Cyprus, Malta and Ireland as being at especial risk from a Brexit, stating that British banks may reconsider their presence in the three former colonies. The study, carried out by S&P, adds that the close relationship of the UK with the three countries would make them far more vulnerable to Brexit’s negative effects than other EU states.
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