Press Release: State aid: Commission approves Cypriot scheme to support credit institutions

The European Commission approved under EC Treaty state aid rules a Cypriot scheme using special government bonds to reinforce stability in financial markets and mitigate the effects of the crisis. The Commission found the measure to be in line with its Guidance Communication on state aid to overcome the current financial crisis. In particular, the measure is limited in time and scope, requires adequate remuneration and foresees sufficient safeguards to minimise distortions of competition. The scheme therefore constitutes an adequate means to remedy a serious disturbance in the Cypriot economy and is compatible with Article 87.3.b. of the EC Treaty.