By Zoe Christodoulides
A year ago those with more than 100,000 euros in Laiki lost all their savings, those with similar amounts in Bank of Cyprus saw their savings slashed by 47.5 per cent. In the process some lost all the money they had put aside for retirement while others said goodbye to their dreams of buying their own home. Jobs and businesses were all affected. Zoe Christodoulides speaks to three whose lives have changed irredeemably
“People didn’t just lose their money, but their dignity, pride, dreams and hopes for the future. How many of them can no longer afford to send their kids to university? How many can still live out the things they had planned before all this?”
Andrew Georgiou sits back on the sofa of his Larnaca home. Like so many others, the 57-year-old London Cypriot was a man with a simple plan: to enjoy retirement in Cyprus with the money he had collected throughout his working life. But the reality he had to face shortly after his move to the island could not have been more different to the one he had envisioned.
Andrew left his job for a national UK news agency, took his pension early, and came to Cyprus in early 2013 along with his father to enjoy a peaceful life under the sun. “Little did I know that things would get a lot more complicated instead of getting easier,” he says.
Andrew made the move after selling his London home. And it seemed logical to bring his own and his father’s money along with him, putting it into a Marfin Laiki savings account. “It seemed the natural thing to do, moving money into the eurozone. Never in my wildest imagination did I dream that part of the eurozone would be amputated. Because that what happened – amputation,” he exclaims.
In total, the Georgiou family had an excess of €800,000 deposited in the now-defunct bank for their new life. Andrew enjoyed his move to a seaside home and planned to make a few investments, purchasing local properties for rental. Needless to say, the enjoyment was short lived. Following the bailout, Andrew and his father lost around €600,000. When his father heard rumours that Laiki was in trouble, his bank manager persuaded him not to move his savings as it was effectively state owned. Two weeks later, it went under.
But Andrew seems more concerned about the human cost of the whole ordeal rather than the money that was lost as his father’s health drastically deteriorated shortly after the haircut, when he was diagnosed with leukaemia. “There is no evidence that his illness was brought on by the financial mess.” But, he says grimly, “it sure didn’t help.
“I think he gave up on life the day of the haircut. It had a terribly adverse effect on his health and he just got worse with each passing day,” he recalls. And what did Andrew feel when announcements were being made about the terms of the bailout? “Shock. But more than that, I was just so terribly disappointed that European family would treat Cyprus differently from other European members. It’s very sad to be treated so very abysmally.”
One year down the line, Andrew is looking to take his remaining money out of the country and no longer has any trust in the banks whatsoever. “I wish I had left my money in the UK, but hindsight is a wonderful thing isn’t it?” He pauses for thought. “That’s not to say that I trust the banks in the UK, and I certainly won’t be transferring all my money into one bank. In my eyes, the European wide banking system is pretty much defunct.”
As for future hopes for the island, Andrew doesn’t see the situation getting any better before at least another five years have gone by. “I won’t say that this is a bad place to live but it’s certainly not what it used to be. Like so many other people, I’ve had to change my plans and I’ll tough it out. And yes, one day, the economy will recover. But that, I’m afraid, won’t be for a while.”
In February 2013, 59-year-old Panikos Demetriou thought he was financially secure. He had €90,000 in one account, €9,000 in another account and €35,000 in a third which he was preparing to send his son in the UK for his upcoming wedding. All deposits were in Laiki Bank. By the end of March 2013, he had to wave goodbye to almost €80,000.
Panikos is yet another British Cypriot who dreamed of leaving the grey drizzle of London for the sunny shores of Cyprus, making the big move seven years ago after many years of hard work in a dressmaking factory. Feeling lonely after his first wife passed away, he decided that the change would do him good, and once in Cyprus, he soon remarried and began a new life. Following the sale of his London home, he felt it was wasn’t really feasible to keep on transferring money over to England and moved all his money over to Laiki five years ago.
“Wherever else would I put it? Under the mattress? I was a fool to think that there were laws to protect us. Little did I know,” he rants. “The corruptness of our system is remarkable. Just remarkable.”
As suspicions mounted about a possible haircut in February- and dubious about any politician who said they would never take any money from anyone’s account- Panikos decided to visit his bank manager, requesting that the account with €95,000 was put solely on his second wife’s name. The bank manager obliged, but omitted to tell him that she also kept his name on the account in order to ensure joint access and supposedly safeguard Panikos from his wife withdrawing the money without his consent.
Once Laiki collapsed and the haircut took place, Panikos not only lost the €35 000 that he had been saving to send his son, but also, €47,500, half of what was in the €95,000 joint account that was supposed to be solely on his wife’s name. If the bank had followed Panikos’ instructions, the money on his wife’s name would have been safeguarded as it fell within the €100,000 bracket. But as the account was on both their names, Panikos’ share was now calculated along with his other savings held in the bank once the haircut took place.
“I was absolutely furious as I had made it clear I wanted just my wife’s name on that account. And if they had listened, that money would have been secure. Once the banks reopened after those two longs weeks, I stormed in and demanded an explanation from the manager. Her answer was ‘sorry’. That’s a really expensive ‘sorry’ if ever there was one,” he rages. “It was the dying wish of my first wife to give our son that money. And it was all taken. Every bit of it.”
When announcements were being made about the bailout in the media, Panikos recalls going stone cold. “This has never happened before in the world- we should get a gold medal for the amount of money that has been stolen from us. Only in Cyprus.”
In the weeks that followed the bailout, Panikos – unable to send over any money to his son – had to borrow money from people he knew in the UK to help fund the wedding. The whole ordeal has fundamentally changed the way he thinks about those in power here in on the island. “I trust nobody in Cyprus. Not the political system, not the banking system – it’s all corrupt. I am so angry at how many people in power have gotten away with draining the country’s money and how us simple ordinary people have to pay for it.” And Panikos is adamant about getting as much as he can out of the country. ”I won’t leave a single penny here- I will send it to England slowly and will just keep the minimal amount that I need to live off. I will never ever be confident in this ridiculous system.”
Maria and Giorgos Theodorou
While most people are fuming about the financial loss that the bailout brought with it, Maria and Giorgos Theodorou speak more about the workers they have had to lay off in their small construction company, the lack of euros that have come in after the whole crash, and the dreams that have been tainted as life took a 360-degree turn.
The middle aged couple insist they have always led a humble life, prioritising the future of their two university aged children. “We were never lavish and didn’t get fancy cars or spend lots of money out in posh restaurants,” says Maria. “We organised ourselves and structured our lives for our kids, our future, our pension.”
For over twenty years, the couple jointly run a small construction company with 12 employees. As the economy slowly took a turn for the worse over the past few years, the amount of money that they were owed slowly piled up, but they always just about managed to stay above board. That was, until this time last year.
Everything froze in the days leading up to bailout and their lives have not recovered since. “We weren’t getting paid for any work we had undertaken, we had no money coming in, and before we knew it, we simply couldn’t pay all of our staff,” recalls Maria. “When the bailout took place, it was the end of one tender we had just completed, and there were no other tenders on the horizon. Summer is usually quiet for construction at the best of times, but there was no work at all in the construction industry. Everything stood still.”
The couple have received no income since last September and the dozen company employees slowly became no employees as they were faced with no other choice but to make everyone redundant. “We’re owed so much money and it’s a vicious circle. If we don’t get paid, we can’t make payments,” explains Maria. “We have no company now, with no future work to give us hope. For now, our machinery has been totally immobilised.”
The whole situation has taken a hefty toll on Giorgos’ health, with his wife explaining that six months of terrible stress- as he desperately tried to rescue the company- were just too much for him and he ended up ill in hospital for period of time in October.
Now desperate to leave the country and look for work further afield, the couple are just about managing to fund their daughter’s studies with the little remaining money that they still have saved. With another son in the army however, abandoning ship isn’t the easiest option. And its common knowledge that finding a job anywhere once you’ve hit middle age is a real challenge.
“All my husband and I ever wanted was to provide for our kids like everyone else. You think what can we do? What can we try? Where can we go? There is no safety net here. You can’t just put your life on hold until the economy one day recovers.”
Deeming what happened last March as a “criminal” act, she views Cyprus as “a testing ground – as nothing more than an experiment by EU leaders.” With little trust in anything or anyone in authority, Maria ends the conversation on a wry note.
“I’m thinking of that new BoC advert that says: ‘I believe again.’ Now that’s a bit of a joke, isn’t