German Parliament Approves Cyprus Bailout

Germany’s lower house of parliament voted overwhelmingly on Thursday to grant Cyprus a 10 billion euro bailout that is designed to avert bankruptcy for the tiny Mediterranean island nation and keep it in the euro zone.

Of the 602 lawmakers in the Bundestag chamber, 487 backed the rescue, under which Cyprus has agreed to impose major losses on depositors, shutter its second largest bank and raise its corporate tax rate.

Separately, German parliamentarians also backed seven-year loan extensions for bailout victims Portugal and Ireland. The Cyprus vote was not in doubt given widespread support from within German Chancellor Angela Merkel’s center-right coalition and backing by many opposition lawmakers from the Social Democrats and Greens.

However surprise news on Wednesday that the fractious Cypriot parliament is also likely to vote on the deal stoked new uncertainty over the fate of the rescue.

via CNBC

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