Cyprus (concluded)

ESM programme for Cyprus (concluded)

The ESM financial assistance programme for Cyprus ended on 31 March 2016. The euro area countries agreed to a package of financial assistance of up to €10 billion for Cyprus in 2013, with the ESM financing up to €9 billion and the IMF around €1 billion. Thanks to a better-than-expected economic recovery, private investors’ participation in bank recapitalisation and a return to market financing, however, the full amount was not needed. The ESM disbursed €6.3 billion, and the IMF a further €1 billion.

In order to receive the loans, Cyprus implemented a number of key reforms, including:

  • restoring the soundness of the Cypriot banking sector by thoroughly restructuring and downsizing financial institutions;
  • cutting the excessive government deficit, in particular by reducing current primary expenditure and increasing the efficiency of public spending; and
  • implementing structural reforms to support competitiveness and sustainable and balanced growth.

Cyprus has managed to restore economic growth and repair public finances much faster than expected. The country’s financial sector – which was the main source of the crisis – was restructured, recapitalised and downsized, and the legal and supervisory framework was modernised. The country regained the trust of investors and returned to the bond market, where it continues to finance its debt at sustainable rates. Going forward Cyprus needs to reduce the high level of non-performing loans (NPLs) and maintain fiscal discipline.

Disbursements of ESM financial assistance to Cyprus

Date of disbursement Amount disbursed Type of disbursment Final maturity Cumulative amount disbursed
13/05/2013 €1 bn Cash 13/05/2026
€2 bn
€ 1bn Cash 13/05/2027
26/06/2013 €1 bn Cash 26/06/2028 €3 bn
27/09/2013 €750 mn Cashless 27/09/2029 €4.5 bn
€750 mn



19/12/2013 €100 mn Cash 19/12/2029 €4.6 bn
04/04/2014 €150 mn Cash 04/04/2030 €4.75 bn
09/07/2014 €600 mn Cash 09/07/2031 €5.35 bn
15/12/2014 €350 mn Cash 15/12/2025 €5.7 bn
15/07/2015 €100 mn Cash 15/12/2031 €5.8 bn
08/10/2015 €200 mn Cash


€6.3 bn
€300 mn Cash


Weighted average maturity of loans: 14.9 years

Details of the ESM floating rate notes provided to Cyprus 1

 ISIN  Issuance date  Maturity   Type     Amount  
EU000A1U98Y4 27/09/2013 27/03/2015 18-month FRN €1.5 bn

1 Notes provided by the ESM are redeemed at maturity and rolled over into cash loans

© European Stability Mechanism 2015

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