Cyprus Applies for Bailout

    A man on a scooter, exist from a gate of Central Bank of Cyprus in Nicosia, Cyprus, Tuesday, March 13, 2012. International ratings agency Moody's downgraded euro member Cyprus into junk status Tuesday on heightened concerns over the exposure of its large banking sector to Greece. The agency reduced its rating on Cyprus by one notch to Ba1 and assigned a negative outlook, meaning that further downgrades are possible. (AP Photo/Petros Karadjias)

    Petros Karadjias / AP Photo

    Weeks after Spain said it would seek European Union aid in recapitalizing its banks, Cyprus applied for bailout funds on Monday. In a statement, government officials cited the threat of financial contagion spreading from Greece. “The purpose of the required assistance is to contain the risks to the Cypriot economy, notably those arising from the negative spillover effects through its financial sector, due to its large exposure in the Greek economy,” read a government statement. Officials in the tiny island nation became the fifth euro zone country to ask for financial assistance from the European Union.

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