FRANKFURT--Cyprus' central bank plans to expand the volume of
emergency loans to the country's banks by about 2.5 billion euros
to 3.0 billion euros ($3.24 billion to $3.89 billion), Die Welt
reports Tuesday, citing several people familiar with the
matter.
The Mediterranean nation's central bank has asked the European
Central Bank for approval of an extension of its Emergency
Liquidity Assistance, or ELA, the German newspaper reports in a
pre-release of an article soon to be published.
The Cypriot central bank's request doesn't include an expansion
of emergency lending to the country's two largest lenders, Bank of
Cyprus PLC (BOCY.CP) and Popular Bank (CPB.CP), also known as
Laiki, according to the report.
Instead, the additional funds are designated for the country's
smaller banks, die Welt reports.
The ECB declined to comment on the report when contacted by Dow
Jones. And the Cypriot central bank wasn't immediately available
for comment.
Cypriot banks have been closed for more than a week while the
government had been negotiating with the rest of the euro zone
about a bailout. Under the terms of the deal agreed early Monday,
Cyprus Popular Bank is to be split up into a "good" and "bad" bank.
The good assets will be transferred to Bank of Cyprus, along with
EUR9 billion of ELA and the deposits covered by an EU-approved
guarantee.
The "bad" bank will for its part be financed mostly by CPB's
uninsured deposits, which are expected to be written down heavily
as the true value of the assets becomes clearer.
Matina Stevis and Geoffrey T. Smith contributed to this
article.
Write to Friedrich Geiger at friedrich.geiger@dowjones.com and
to Todd Buell at todd.buell@wsj.com
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