No deal this month on Cyprus bailout: Jean-Claude Juncker

BRUSSELS: Cyprus, the next eurozone bailout candidate after Greece, Ireland and Portugal, is unlikely to see a rescue accord agreed this month, eurogroup head Jean-Claude Juncker said Thursday.

The 17 eurozone finance ministers are due to meet on January 21 and and the single currency group will "not be in a position to (reach a) solution" this month, Juncker said, adding: "It will take longer."

EU sources have suggested that a bailout for Cyprus could take several months to negotiate given a series of concerns over the sustainability of its debt and the soundness of its banking system, which was badly exposed to Greece.

German Chancellor Angela Merkel said on Wednesday that Cyprus would not be allowed any exceptional terms as it seeks a bailout worth 17 billion euros ($22 billion), with talks likely to continue for some time.

"There are no special conditions for Cyprus ... We have generally accepted rules in Europe and we are a long way from finishing the negotiations," Merkel said.

Cypriot Finance Minister Vassos Shiarly was expected to hold talks with EU diplomats on Thursday to thrash out the possible terms of a bailout that would be equivalent to an entire year's output for the tiny island economy.

German finance ministry spokesman Johannes Blankenheim said that the January 21 meeting would serve to provide "a basis for further discussion" but noted that decisions were unlikely.

"When financial markets are nervous, the bankruptcy even of a small country can led to negative contagion effects. We must bear this in mind," Blankenheim added.

Cyprus has already pushed through tough austerity measures to meet the demands of eurozone creditors for more than one billion euros in cuts and savings.