On March 15 banks in Cyprus closed their doors , and they have not yet re-opened. The trickling cash flow already has taken its toll.Small businesses say they are doing very little trade, and some say they already have had to lay off employees.But the worst maybe is still to come, though, because the deal struck with international lenders aims to shrink the Cypriot banking sector, which is about eight times the size of the economy.The country's biggest lender, the Bank of Cyprus, will be radically restructured and Laiki Bank, the second largest, is set to close.The bank employs 8,000 people - a massive blow for a small country with a population of less than 1 million.James Ker-Lindsay, Cyprus expert at the London School of Economics, said the whole economy will be affected."The banks are a major part of the Cyprus economy," said Ker-Lindsay."There is going to be a lot of businesses which will have lost money in all of this.This will trickle down through the economy.It will be absolutely enormous, the effects of this.This EU/IMF deal differs from other euro zone bailouts because, instead of taxpayers footing the bill,depositors with large balances are bearing the costs.Cyprus academic Vassilis Monastiriotis said it is a major shift in euro zone policy.
