Cyprus's president said on Sunday that savers made to pay a tax on bank deposits as part of a sovereign bailout deal will be compensated by shares in banks guaranteed by future natural gas revenues.
In a televised address to the nation, President Nicos Anastasiades said he had to accept a tax on bank deposits in return for international aid, or else the island would have faced bankruptcy.
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"The solution we concluded upon is not what we wanted, but is the least painful under the circumstances," Anastasiades said.
Cypriot bank depositors will be required to forfeit part of their savings under a deal brokered by euro zone finance ministers on Saturday to offer the Mediterranean island state a 10 billion euro bailout. The levy will generate almost 6.0 billion in savings.
The news triggered a run on cashpoints on Saturday, depleting them within hours while it was unclear whether banks would open for business on Tuesday after a Monday bank holiday.
Parliament has to approve the levy, which calls for a 9.9 percent cut on deposits exceeding 100,000 euros and 6.7 percent on deposits below that figure.
(Reporting By Michele Kambas; Editing by Jason Webb)