Cyprus has decided to sell off much of its gold reserves to help finance part of its bailout.

An assessment by the European Commission says Cyprus must sell about 400 million euros worth of gold.

Cyprus has already been forced to wind down one of its largest banks in order to qualify for a 10 billion euro lifeline from international lenders.

Even with that bailout, it is predicted that the Cypriot economy will shrink by 8.7% this year.

Cyprus’s total bullion reserves stood at 13.9 tonnes at the end of February, according to data from the World Gold Council.

Cyprus has decided to sell off much of its gold reserves to help finance part of its bailout

At current prices, 400 million euros’ worth of gold amounts to about 10.36 tonnes of metal.

The sale will be the biggest bullion sale by a eurozone central bank since France sold 17.4 tonnes in the first half of 2009.

European finance ministers meet in Dublin on Friday to discuss the Cyprus bailout.

Analysts say it is very unlikely that other EU states will become big sellers of the precious metal.

Portugal holds 382.5 tonnes of gold, worth some 14.76 billion euros at current prices, in its reserves, while Spain’s holdings stand at 281.6 tonnes, worth 10.8 billion euros.

Italy is the world’s fourth-largest gold holder, with 2,451.8 tonnes, worth 94.6 billion euros.