STOCK MARKET WATCH -- Wednesday, 18 September 2013

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11. EU and IMF warn of risks for Cyprus program

http://www.reuters.com/article/2013/09/18/us-eurozone-cyprus-idUSBRE98H0GQ20130918

(Reuters) - Cyprus has made progress with overhauling its banking sector and pushing through structural reforms to the economy but significant risks remain for the island, a report by the country's international lenders said on Wednesday.

Cyprus became the fifth euro zone country to receive international assistance in March, when it secured a 10 billion euro package of loans in return for reforms and an unprecedented one-off levy on large bank deposits.

Experts from the European Commission, the European Central Bank and the International Monetary Fund - together known as the troika - said in their first review of the rescue program that Nicosia had taken decisive steps to stabilize its financial sector and was gradually relaxing capital controls.

But the economy is expected to contract by a total of 13 percent in 2013 and 2014, before returning to marginal growth in 2015. Unemployment continues to rise and there is hard work to do to ensure the economic reforms are fully enforced.