Cyprus

GLOBAL

Chris Bowie has taken bank exposure to its lowest ever level in his £285m Ignis Corporate Bond fund amid growing fears bondholders will be wiped out if there is another crisis.

SPECIAL REPORT

Over the course of history, whenever governments have over-borrowed and become enmeshed in a debt trap, they have typically resorted to a process of financial repression as a means of redressing the problem.

Cyprus has implemented a series of stringent capital controls as it seeks to prevent assets fleeing the country when its banks reopen today.

Cyprus has agreed a €10bn bailout deal that will force large losses on some big deposit holders but avoids a controversial levy on all bank accounts.

The situation in Cyprus could have a far more negative impact on the credit market than it has so far, Kames Capital's Melanie Mitchell has said.

Japan's Nikkei index experienced its biggest fall since November as concerns about Cyprus and the eurozone continued to batter markets.

European markets ended Tuesday lower as concerns over Cyprus and uncertainty over the European debt crisis weighed on investor confidence.

Cypriot officials are attempting to renegotiate the terms of its €10bn bailout to limit the pain for small account holders, according to reports.