Cyprus signs 2.5 bln euro loan deal with Russia

Cyprus and Russia have signed a bilateral deal for a 2.5-billion-euro loan to the Mediterranean island on Friday, the Cypriot finance ministry said, to help it refinance debt maturing next year.
Russian Deputy Finance Minister Sergey Storchak and Cypriot Finance Minister Kikis Kazamias signed the agreement in Moscow.
Disbursement of the first tranche of the loan, which finance officials have previously said would be 590 million euros, will be made by Dec. 31, the Cypriot ministry said in a statement.
Cyprus has been effectively shut out of international capital markets since May because of implicitly high interest rates on its traded debt after ratings downgrades on fiscal slippage and its banks' exposure to bailout recipient Greece.
Two more loan instalments, of 1.32 billion euros and 590 million euros, will be made by the end of March. Cypriot government officials have previously said the loan is repayable in 4.5 years and bears an interest rate of 4.5%.