The Law Office of the Republic said in a press release it will appeal a Limassol District Court decision to compensate a foreign depositor of the defunct Laiki Bank over the haircut imposed on uninsured deposits over €100,000 in 2013, as part of the bailout in Cyprus.

This was the first Court decision that vindicates a depositor over the haircut imposed by the Euro area finance ministers (Eurogroup) decisions in March 2013 as part of the Cypriot €10 billion bailout.

Sources told CNA that the Central Bank of Cyprus will also submit an appeal against the Court ruling.

Amid the financial crisis, Cyprus received a €10 billion bailout from the European Stability Mechanism and the IMF. As part of the decision a haircut on uninsured depositors was imposed on Bank of Cyprus, while Laiki Bank would be liquidated. According to IMF estimates, the haircut of uninsured deposits amounted to almost €8 billion, of which €3.7 billion in Laiki.

In its ruling issued yesterday, the Limassol Court said, among other things, that "the impairment of the plaintiff's deposits was due to the negligent acts of the Republic of Cyprus and the gross negligence of the CBC and not to reasons related to the rules of the market."

So far, courts in Cyprus have exonerated the Republic in numerous appeals by depositors or companies against the haircut decision.

“The court decision is the first one which vindicates a plaintiff in a similar case and is diverging from all previous rulings issued so far,” the Law Office said in a statement.

After examining the court ruling, the Law Office deemed that this should be appealed and a group of the Law Office’s experts are preparing the appeal, the press release added.