The Cypriot authorities have asked Russia for another 5 billion euros in loans, The Daily Telegraph reported on Wednesday, citing Cyprus-based Alithia newspaper.
Last year, Russia agreed to grant 2.5 billion euros in loans to Cyprus, which amounts to about 10 percent of the republic’s GDP.
Cyprus needs funds to recapitalize local banks which are under stress due to the eurozone debt crisis. International rating agency Moody’s cut the ratings of Cyprus’s two largest banks, Bank of Cyprus and Hellenic Bank on Tuesday, and put the island’s third largest bank, Cyprus Popular Bank, on review with a possible downgrade.
Cypriot banks’ exposure to Greek investments is estimated at 23 billion euros, which exceeds Cyprus’s 2011 GDP of 17.3 billion euros.