A total of €28.7 million is expected to be distributed this year through the National Solidarity Fund to depositors of the former Bank of Cyprus and Laiki Bank, as well as holders of bank securities who suffered losses during the 2013 banking crisis.
The payment forms part of the second phase of the partial compensation scheme established to provide financial relief to individuals affected by the restructuring measures imposed on Cyprus' two systemic banks in March 2013.
To that end, the Finance Ministry has submitted the National Solidarity Fund's 2026 budget to the House of Representatives, where it is due to be examined today by the parliamentary finance committee.
€28.7 million earmarked
According to the budget, €28,725,209 is expected to be disbursed by the end of the year under the fund's 2025 partial compensation scheme.
The allocation covers outstanding beneficiary cases, approved appeals and applications where verification procedures had not yet been completed.
The amount is significantly lower than the €44.36 million paid last September to 4,524 beneficiaries.
This year's payment is therefore approximately €15.6 million lower, representing a reduction of roughly 35% compared with last year's payout.
At the same time, the total claims of depositors and securities holders affected by the banking crisis are estimated at around €2 billion, highlighting the gap between total losses and the compensation distributed so far.
Compensation levels reduced
The first phase of the scheme provided compensation equal to 10% of the loss, subject to maximum limits.
Those limits were:
- €100,000 for deposits and securities at Laiki Bank
- €13,000 for Bank of Cyprus deposits
- €99,700 for securities
For 2026, however, the compensation coefficient has been reduced to 2.5%, lowering the amounts payable to beneficiaries.
Presidential commitment
Last August, President Nicos Christodoulides informed representatives of affected depositors and securities holders that a further payment would be made in 2026, although no amount was specified at the time.
The decision represented a shift from an earlier government position, expressed through Finance Ministry sources, that a second compensation phase would not proceed in 2026 due to fiscal constraints.
It was also announced during the August meeting that the application platform would reopen for approximately 1,800 applicants who had failed to complete submission or verification procedures.
These include around 1,200 applications that were deemed incomplete and rejected, as well as approximately 600 applicants who submitted paper forms instead of electronic applications.
€189 million reserve
The National Solidarity Fund's 2026 budget was approved by the fund's management committee during a meeting on 7 September 2026, with the chairman's casting vote proving decisive.
The fund's total income for 2026 amounts to €50 million, all of which comes from a government grant.
In addition, the fund's cash reserves stood at €189.18 million at the end of 2025.
A further €50 million government contribution is expected in 2027.
Who will receive the money?
The €28.7 million allocation covers several categories of beneficiaries and outstanding cases.
The budget provides for payments to approved beneficiaries under the 2025 compensation scheme whose personal details have been verified but whose bank account verification remains incomplete.
It also covers individuals who submitted applications between 20 December 2023 and 25 May 2024 but failed to complete the verification process during the period from 19 June to 31 October 2025.
Provision has also been made for successful appeals approved under the terms of the compensation scheme.
€44.3 million paid last year
The first major compensation payment was made last September when the National Solidarity Fund distributed €44.36 million to 4,524 eligible individuals.
The payments covered applicants who submitted electronic applications through the compensation scheme portal by 13 August 2025 and whose details had been successfully verified.
According to the Finance Ministry, compensation payments will continue at regular intervals with the aim of ensuring timely and fair treatment of all beneficiaries.
Funds earmarked for former Laiki headquarters
The Finance Ministry's 2027 budget also includes a provision for the former headquarters of Laiki Bank.
Specifically, €1.855 million has been earmarked for the purchase of the building at the junction of Limassol and Athalassa avenues, with the intention of using the property to meet accommodation needs for government services.
