Revamped Cyprus deal to close bank, force losses Eurogroup President Jeroen Dijsselbloem ... holds a news conference at the end of the Eurogroup meeting on Cyprus. Cyprus has clinched a last-ditch deal with international lenders for a 10 billion euro ($13 billion) bailout that will shut down its second largest bank and inflict heavy losses on uninsured depositors, including wealthy Russians. The plan would save Cyprus from financial meltdown by winding down the Popular Bank of Cyprus and shifting deposits below 100,000 euro to the Bank of Cyprus to create a "good bank." The agreement emerged after fraught negotiations between President Nicos Anastasiades and heads of the European Union, the European Central Bank and the International Monetary Fund - hours before a deadline to avert a collapse of the banking system. International Monetary Fund (IMF) executive director Christine Lagarde ... at the news conference at the European Council building in Brussels. The plan, swiftly endorsed by euro zone finance ministers, will spare the east Mediterranean island a financial meltdown by winding down Popular Bank of Cyprus, also known as Laiki, and shifting deposits below 100,000 euro to the Bank of Cyprus to create a "good bank." Deposits above 100,000 euro, which under EU law are not guaranteed, will be frozen and used to resolve debts, and Laiki will effectively be shuttered, with thousands of job losses. An EU spokesman said no levy would be imposed on any deposits in Cypriot banks. A first attempt at a deal last week collapsed when the Cypriot parliament rejected a proposed levy on all deposits. Deal ... follows fraught negotiations between President Nicos Anastasiades and heads of the European Union, the European Central Bank and the International Monetary Fund. The key issues in dispute were how Cyprus would raise 5.8 billion euros from its banking sector towards its own financial rescue, and how to restructure and resolve the outsized banks. The EU's economic affairs chief Olli Rehn said there were no good options but "only hard choices left" for the latest casualty of the euro zone crisis. The euro gained against the dollar on the news in early Asian trading. Analysts had said failure to clinch a deal could cause a financial market selloff, but some said the island's small size - it accounts for just 0.2 percent of the euro zone's economic output - meant contagion would be limited. In the Cypriot capital, Nicosia, on Sunday the mood was anxious. Cyprus's banking sector, with assets eight times the size of its economy, has been crippled by exposure to Greece, where private bondholders suffered a 75 percent "haircut" last year. About 200 bank employees protested outside the presidential palace on Sunday chanting "troika out of Cyprus" and "Cyprus will not become a protectorate." The plan to tap pension funds was shelved due to German opposition, a Cypriot official said. The revised bailout plan many not require further parliamentary approval since the idea of a levy was dropped. The tottering banks hold 68 billion euros in deposits, including 38 billion in accounts of more than 100,000 euro- enormous sums for an island of 1.1 million people which could never sustain such a big financial system on its own. Details of the deal in a statement from euro zone finance ministers: Laiki will be resolved immediately - with full contribution of equity shareholders, bond holders and uninsured depositors - based on a decision by the Central Bank of Cyprus, using the newly adopted Bank Resolution Framework. Laiki will be split into a good bank and a bad bank. The bad bank will be run down over time. The good bank will be folded into Bank of Cyprus (BoC), using the Bank Resolution Framework, after having heard the Boards of Directors of BoC and Laiki. It will take 9 bn Euros of ELA with it. Only uninsured deposits in BoC will remain frozen until recapitalisation has been effected, and may subsequently be subject to appropriate conditions. The Governing Council of the ECB will provide liquidity to the BoC in line with applicable rules. BoC will be recapitalised through a deposit/equity conversion of uninsured deposits with full contribution of equity shareholders and bond holders. The conversion will be such that a capital ratio of 9 per cent is secured by the end of the program. All insured depositors in all banks will be fully protected in accordance with the relevant EU legislation. The programme money (up to 10 billion euro) will not be used to recapitalise Laiki and Bank of Cyprus.