The Bank of Cyprus, the country's largest lender, said it backed the idea of confiscating some percentage of all bank deposits over 100,000 euros because there were no immediate alternatives.
The bank warned Cypriots that "a potential collapse of the banking sector could lead to the total loss of all deposits above 100,000 euros and the immediate sale of all collateral accompanying non-performing loans."
Meanwhile, Cypriot efforts to clinch a contribution from Russia appeared to have failed. Russia is a key player in Cyprus as Russian depositors have parked around 20 billion euros in the country.
"We will only be ready to discuss various ways of support for that state only after the EU nations and Cyprus work out a final settlement," Russian Prime Minister Dmitri Medvedev told a news conference.
Russia's finance minister, Anton Siluanov, said the Cypriots were seeking investment from Russian companies in a Cypriot state-owned firm that will manage revenue from the island's newfound offshore gas. The Russian investors, however, were not interested.
Cyprus also offered stakes in some of its banks, but there were no takers in Moscow for that, either. Siluanov also said they were not discussing providing a new loan to Cyprus as the EU has set a debt limit for Cyprus.
Back in Nicosia, worried Laiki employees gathered near parliament for a second day to protest the bank's restructuring, which would break the lender in two. One side would take on the soured investments to allow the stronger side to survive.
"The bank is finished, we'll lose our jobs and I'm worried about my kids," Laiki employee Nikos Tsiangos said, standing behind barricades and a cordon of police that have blocked the way to Parliament. "They've brought us to the brink, the Europeans wanted to destroy our economy and they've done it."
The bills lawmakers were considering also included setting up an "Investment Solidarity Fund" to receive donations from the church and to pool revenue from other measures. They were also due to vote on restricting banking transactions in times of crisis.
A vote on the laws had been scheduled for Friday morning, but was pushed back as negotiations continued.
Separately, President Nicos Anastasiades announced there had been agreement for Greek subsidiaries of Cypriot banks to be sold, "with significant benefit for the Cypriot side," a statement from Anastasiades' office said.
Europe also turned up the pressure on Cyprus. Luxembourg's finance Minister Luc Frieden told Germany's Inforadio that Cyprus "certainly must change a very great deal in its financial sector ..... I see among some euro states little financial room for more concessions to Cyprus."