ECB sets Cyprus bailout deadline

City A.M. Reporter

THE European Central Bank has set Cyprus a Monday deadline to raise billions of euros to clinch an international bailout, or face a cut-off from its emergency liquidity assistance programme.

The warning came as Cypriot leaders are locked in crisis talks on a "plan B" to raise €5.8bn (£4.9bn) demanded by the EU under a €10bn rescue, after policymakers rejected a controversial bank levy earlier this week.

Officials said new options discussed this morning could include nationalising pension funds of semi-state companies, issuing an emergency bond linked to future natural gas revenue or a revised bank deposit levy hitting only large investors.

The European Central Bank, which has Cyprus's banks on a liquidity lifeline, said it had until Monday to get a deal in place or funds would be cut off.

Cypriot banks will remain shut until Tuesday, while the stock market is also suspended for the rest of the week.