Top news: European financial regulators struck a last-minute deal with the Cypriot government in the early hours of Monday that will prevent Cyprus' exit from the eurozone and scraps a politically toxic proposal to tax small bank deposits in order to fund the bailout. But the new deal still imposes steep requirements on the Cypriot economy and will likely bring to an end its highly lucrative, if volatile, position as an off-shore tax shelter.
The new agreement, hammered out during marathon negotiatons, will impose significant fees -- the exact size of which remain to be determined -- on deposits above 100,000 euro in Laika Bank, the country's second largest, and will drastically reduce the size of the country's banking sector, which had expanded to several times the size of the entire Cypriot economy. Under the agreement, Laiki will be wound down and split into two entities. Deposits under 100,000 euro will be spun off and moved to the Bank of Cyprus, which will help support that bank's survival, while deposits over that amount will be used to finance the bailout. Laiki bondholders are also expected to absorb large losses under the deal. Additionally, Cyprus agreed to cut government spending, carry out privatizations, and trim the size of the banking sector.
The agreement ends a week of fraught negotiations and panicked bank runs in Cyprus, and while the agreement ensures Cyprus' continued membership in the eurozone, it is no major victory for any of the parties involved. "It's not that we won a battle, but we really have avoided a disastrous exit from the eurozone," Cypriot Finance Minister Michalis Sarris said in Brussels.
Central African Republic: Rebel forces seized control of Bangui, the capital of the Central African Republic, amid reports that the country's president had fled. President François Bozizé had attempted to buy off the militia and stall their advance through aborted peace talks, and their seizure of the capital represents the most significant escalation in violence in a rebellion that has been brewing for several years.
- Moaz al Khatib, the moderate head of the Syrian Opposition Council, resigned in protest of the selection of Ghassan Hitto to lead the interim Syrian government.
- The head of the Free Syrian Army was injured in a bomb blast, resulting in his foot to be amputated.
- In a surprise visit to Baghdad, Secretary of State John Kerry lobbied the Iraqi government to prevent Iran from sending arms to the Syrian regime but failed to produce a diplomatic breakthrough.
- Pervez Musharraf, the exiled former president of Pakistan, returned to his country, where he faces myriad legal challenges and a highly uncertain political future.
- The U.S. military transferred control of the last detention facility under its control in Afghanistan to the Afghan government, ending a long-standing dispute.
- Sectarian violence in Burma spread to at least two additional cities over the weekend and saw tensions between Buddhists and Muslims boil over, leading to the burning of several mosques.
- Hundreds of thousands of people rallied in Paris against a law that would legalize same sex marriage, which has been passed in the lower house and is set to be taken up by the French Senate next month.
- In what will be his first overseas trip, Pope Francis announced that he will visit a youth festival in Brazil in July.
- After searching for chemicals and radiation at the home of deceased Russian oligarch Boris Berezovsky, British police said hey had found no trace of such materials or evidence of outside involvement in his death.
- Radical Islamists infiltrated and attacked the city of Gao in Mali but were repulsed by Malian forces.
- In his second overseas trip since taking power, Chinese President Xi Jinping praised<> Africa as a continent "of hope and promise" during remarks in Tanzania.
- Zambia's former President Rupiah Banda was arrested on charges he had stolen $11 million in connection with an oil deal.
- Police in Rio de Janeiro forcibly evicted a group of indigenous people who had been squatting in an old museum that authorities want razed in advance of next year's World Cup.
- Salvadorans marched through the streets Sunday urging sainthood for the slain archbishop Oscar Arnulfo Romero, who was killed in 1980 by a gunman believed to be working on behalf of El Salvador's military government.
- The bodies of seven men placed in plastic chairs near a traffic circle were found in Michoacan, and another seven, including three federal agents, were killed in Guerrero.
OHN THYS/AFP/Getty Images