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Buying out frozen savings accounts
Intermediary investment bankers have decided to earn some money as a result of the lawsuits filed by individual Cyprus account holders by offering to buy up frozen deposits on the secondary market. Discounts vary from 50% to 95% of the amount in a savings account, depending on the bank. In spite of the high risks involved, even large financial institutions are prepared to buy up savings accounts, confirms Diamond Age fund. Another form of assistance available to those with frozen accounts is to file a class action suit.
Not only have lawyers discovered a way to earn some money by representing the interests of savings account holders, so have investment bankers. Indeed, Diamond Age has sent its clients with assets in Cyprus a letter in which the fund has suggested contacting the holders of frozen accounts on the island (available at Gazeta.ru). The investment fund took this step after having received “numerous purchase requests”. Dedicated investors have approached the fund with offers to identify prospective sellers of Cyprus savings accounts, and they have even set a price. For savings accounts in the Bank of Cyprus, investors are prepared to pay 30-50 cents on the dollar; however, the same investors are prepared to pay only 5 cents on the dollar for savings accounts in Laiki Bank.
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“As a result [of selling the rights to savings accounts], competition amongst creditors could spring up”, warns Mr. Magonya of ART DE LEX.
Not only have lawyers discovered a way to earn some money by representing the interests of savings account holders, so have investment bankers. Indeed, Diamond Age has sent its clients with assets in Cyprus a letter in which the fund has suggested contacting the holders of frozen accounts on the island (available at Gazeta.ru). The investment fund took this step after having received “numerous purchase requests”. Dedicated investors have approached the fund with offers to identify prospective sellers of Cyprus savings accounts, and they have even set a price. For savings accounts in the Bank of Cyprus, investors are prepared to pay 30-50 cents on the dollar; however, the same investors are prepared to pay only 5 cents on the dollar for savings accounts in Laiki Bank.
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“As a result [of selling the rights to savings accounts], competition amongst creditors could spring up”, warns Mr. Magonya of ART DE LEX.