In an effort to comply with EU harmonisation directives, the Cyprus Parliament has voted to scrap the 9% interest rate ceiling that has been in place since Cyprus's days as a British colony.
The interest rate ceiling will be abolished from 1 January 2001 when the Cyprus Central Bank will take over control of interest rates. The liberalisation of interest rates means that lenders will not be able to capitalise the interest due on outstanding loans more than twice a year.
In order to minimise the impact of rate rises on current borrowers, special transitional rules will apply until December 31, 2002. Under the transitional arrangements, borrowers with existing loans below CYP 60,000 will have the option to select either the fixed 9% interest rate or the current fluctuating rate. From 2003 onwards all loans that have not been fully repaid will be subject to the current floating rate of interest.
Ruling party Disy Party deputy Prodromos Prodromou said implementing the new law in 2001 provides ample time for adjustment. "We've been talking about it for ten years," he said, adding that markets must be opened up and an end put to protectionism.
.
Network Tweets
Network BlogsContent
provided by
|
Archive | Resources | Partners | Site Map | Links | Newsletter Archive | Contact | RSS Feeds | About | Syndication | Advertising & Marketing | Recruitment | Terms & Conditions | Privacy & Cookies
Copyright © 2012 - All Rights Reserved - Tax-News.com
IMPORTANT NOTICE: Tax-News.com has taken reasonable care in sourcing and presenting the information contained on this site, but accepts no responsibility for any financial or other loss or damage that may result from its use. In particular, users of the site are advised to take appropriate professional advice before committing themselves to involvement in offshore jurisdictions, offshore trusts or offshore investments.
Write a comment