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The Cyprus House of Representatives decided on Thursday, in a unanimous vote, to suspend until 2 April the implementation of a foreclosures law that is a key condition of the country’s EU/IMF bailout, spelling a further hold-up in the island taking part in the European Central Bank's €1.1 trillion bond-buying scheme. This is the fourth suspension of the foreclosures legislation, since September 2014.

MPs say the law should be adopted simultaneously with an insolvency framework, outlining protection mechanisms for primary residences and third parties who guaranteed mortgages. The insolvency framework is still being reviewed by the House of Representatives.

Cyprus's lenders say full adoption of a foreclosures framework to allow banks to wrestle down a mountain of non-performing loans is a 'prior action' required before any further disbursement of aid, and a formal assessment on Cyprus's progress.

Cypriot officials say ECB purchases of Cypriot government debt would help bring down yields and assist Cyprus in its return to capital markets. They have said that the ECB could buy up to €500 million in Cypriot sovereign bonds under the QE programme, which began this month.

The foreclosures law was passed late last year on the provision that it would only come into effect when the insolvency framework was adopted.

Furthermore, the House of Representatives suspended indefinitely foreclosures of mortgaged property bought by borrowers who exposed to insolvent land developers. Many borrowers are trapped because they purchased properties without taking title deeds, as developers cannot transfer ownership because they are insolvent. MPs fear that the banks may seize the properties pledged as collateral by insolvent developers despite that the loans of the borrowers that bought the houses are being serviced.