Anxious British expats are looking to protect their savings as the Cypriot bailout deal sends shockwaves around the eurozone.
Though the exact terms of the bailout deal for Cyprus are still being finalised, financial advisory firm deVere said it has seen a surge in the number of enquiries from British expats in Spain, Italy and Greece about moving their money to "safer jurisdictions".
The Cypriot's €10 billion deal will see the island's second largest bank, Laiki, shut down and depositors with more than €100,000 (£85,000) in their accounts subject to a one-off levy. It is not yet clear exactly how much the tax will be – but the revised terms of the deal should safeguard those with less than €100,000 in the bank.
Alarms sounded across the continent yesterday when President of the Eurogroup Jeroen Dijsselbloem said the Cypriot deal would become the "template" for future bailouts.
Dijsselbloem later sought to temper his comments by saying no templates are used in such deals. But Nigel Green, of the deVere Group, said the damage had already been done.
The damage has been done
"Template or no template, the damage has already been done as the slip of the tongue effectively confirmed what people have been thinking since the idea to raid depositors' savings in Cyprus was first mooted last week – that if this controversial plan goes ahead it will be extrapolated to prop up other vulnerable banking sectors in Europe," he said.
"Similarly, with officials even publicly suggesting deposits of under €100,000, which are supposed to be protected by the state under EU law, could be hit, it carries the implication that such a move is very much on the table.
"As a direct consequence, more and more expats in Spain, Italy, Portugal and Greece are now not unreasonably worried for their deposits in these countries."
There are an estimated 800,000 Britons living in Spain and Portugal alone.