Eurozone member Cyprus has told the European authorities that it intends to apply for financial assistance from its partners in the European currency union.
The request makes Cyprus the fifth eurozone country -- after Greece, Ireland, Portugal and Spain -- to seek foreign aid from its partners in the monetary bloc.
The island nation's government said on June 25 that a write-down of Greek bonds, which hit its banks hard, pushed it to submit a request for assistance.
It did not specify a figure for the requested aid.
But Finance Minister Vassos Shiarly told Reuters that Cyprus will seek enough money from European rescue funds to cover fiscal needs as well as a bank recapitalization. The amount it requires will be determined in the coming weeks.
President Demetris Christofias called for an emergency meeting of party leaders to be held on June 26 to discuss the state of the country’s recession-hit economy.
Cyprus is set to take over the EU presidency on July 1.
Earlier on June 25, Cyprus's credit rating was cut to junk status by the Fitch ratings agency, making it very hard for it to raise funds by itself.
Fitch said the downgrade was "principally due to Greek corporate and households exposures" of the country's three largest banks.
Fitch said the Cypriot banks would need support of up to 4 billion euros ($5 billion), the equivalent of almost a quarter of its 2011 gross domestic product.
Meanwhile, Spain formally requested a bailout loan
from its eurozone partners to save its ailing bank sector.
No figures were made public by Madrid, but eurozone governments have already agreed to place up to 100 billion euros ($125 billion) in loans at Spain's disposal.
The announcements on June 25 came amid concerns that an EU summit on June 28 will fail to produce a deal to shore up the euro.
With reporting by AFP, AP, dpa, and Reuters