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With the clock ticking until the EU’s Monday deadline, the pressure is on Cyprus to find a solution to the impending meltdown of its banking system.

With the “Plan A” deal dead and buried, the onus is on Nicosia to come up with a “Plan B” that is acceptable to Brussels; one that does not involve any more lending, and does involve the Cypriots raising a substantial sum to help pay for the 10 billion-euro bailout still on the table.

“The next few hours will determine the future of the country,” said government spokesman Christos Stylianides.

The finance minister is on his way back from Russia, but with no good news for his compatriots. Russians have billions of euros in Cypriot banks and it had been hoped in Nicosia that Cyprus’ gas could be used in a deal to secure Russian financial assistance. But those hopes seem to have been dashed, and Russia’s Finance Minister has said talks with his Cypriot counterpart had ended with no result.

The EU and IMF have dropped their insistence on a charge on all bank deposits; now only savers with more than 100,000 euros will be hit, and the Cypriot central bank last night proposed an emergency restructuring of the banking sector to guarantee small depositors.

Parliament has reconvened today to vote on the new plan, which also contains what is being called a “solidarity fund”, and possible capital controls.

Failure to agree will lead to the EU ending its financial support for the banking system, probable bankruptcy for at least the two largest banks, and Cyprus having to devalue its currency. Since it is locked into the eurozone, that means it would have to quit the single currency.

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