Cyprus's GDP per capita is $28k[1] and the reason Cyprus needs a bailout for 10B Euros is because its economy is worth 17.5B Euros which (until last week anyway

Cyprus's GDP per capita is $28k[1] and the reason Cyprus needs a bailout for 10B Euros is because its economy is worth 17.5B Euros which (until last week anyway) was expected to fall 3.5% this year. Likewise, Cyprus has a large banking system in relation to the size of the economy - as I mentioned in the previous comment - which means that if the government needs to bail out its banks (as it does now) then the economic hardship of doing so is going to be immense. Cyprus established itself as an offshore-haven through double tax treaties although this has been under-threat due to the EU wanting to harmonize this AND due to the potential levy because of their economic crisis, Russia have threatened to rip up its double-taxation treaty with Cyprus (which attracted Russian Billions in the first place). Russia is extremely important to the Cypriot economy as almost 30 Billion of the 68 Billion is from Russia which is larger than Cyprus's entire GDP. Moreover, the risks aren't really to do with the deposits but rather to do with what is being done with the money as I mentioned earlier, Cyprus are "highly exposed to the Greek risk (40% of the loan portfolio), is a systemic risk because of its size, with a balance sheet equal to seven times GDP and a high inter mediation raising the level of credit up to 280% of GDP. At the beginning of 2012, the portfolio of loans to Greek households and companies amounted to 120% of GDP."[2] [1] http://www.imf.org/external/pubs/ft/weo/2012/01/weodata/weorept.aspx?pr.x=39&pr.y=3&sy=2009&ey=2012&scsm=1&ssd=1&sort=country&ds=.&br=1&c=423&s=NGDPD%2CNGDPDPC%2CPPPGDP%2CPPPPC%2CLP&grp=0&a= http://www.imf.org/external/pubs/ft/weo/2012/01/weodata/weor... [2] http://globaledge.msu.edu/countries/cyprus/risk/ http://globaledge.msu.edu/countries/cyprus/risk/