Juncker Warns Against Bondholder Losses in Cyprus Aid Package

Luxembourg Prime Minister Jean-Claude Juncker said euro-area leaders should avoid imposing losses on bondholders as part of a bailout package for Cyprus because a so-called haircut would risk unsettling financial markets.

“We mustn’t apply a Greece-type solution to Cyprus because this could trigger massive uncertainties in financial markets if it seemed that we don’t care about our credibility because we would do the same in Cyprus than in Greece,” Juncker said today in Brussels after a summit of European Union leaders. “There are other possibilities.”