Now debts are costly

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For the purpose of improving the liquidity of the securities market, the government of Cyprus is forced to use extreme measures – securitisation of bad debts of banks. Cypriot banks are encouraged to create subsidiaries, which are based on the client’s debts, those will be to issue securities or bonds to investors. Thus, the securities portfolio will consist of credits. A real example of this is the securitisation of mortgages.