Italy Consumer Confidence down to 85.2 in Mar from 86 in Feb

Today’s agreement between EU Finance ministers, the Troika and the Cypriot Government involves immediately closing down Laiki Bank, second largest bank in Cyprus, splitting it into a ‘good’ and ‘bad’ bank and safeguarding all deposits under €100,000 (to be rolled into the Bank of Cyprus). According to TD Securities analysts, the deal implies full participation by equity holders, bond holders (both junior and senior) and uninsured depositors (the latter expected to raise €4.2b): “Uninsured deposits in the Bank of Cyprus will be immediately frozen until the authorities have determined the amount needed to be ’bailed in’ (specifically, via a deposit/equity swap) for the Bank’s recapitalisation needs, as the €10b ‘program money’ will not be used for that purpose”, wrote analyst Alvin Pontoh, adding that the fact that Bank of Cyprus will avoid an unwinding at this juncture appears to be a victory for Cyprus and EC, at the expense of the IMF and Berlin who had reportedly insisted on unwinding both banks. Also confirmed was that the Bank of Cyprus will assume the €9bn of ELA support from Laiki, but it remains unclear whether banks will re-open on Tuesday.