FRANKFURT (MarketWatch) — Financial markets were enjoying a modest relief rally in the wake of Cyprus’s last-minute bailout Monday, but the gains gave way to worries that future aid agreements will force depositors to participate.

The euro tumbled, European equities were dragged down by banking stocks and Wall Street turned lower after Jeroen Dijsselbloem, the Dutch finance minister and chairman of the euro-zone finance ministers, indicated in remarks to Reuters and the Financial Times that, as in the Cyprus deal, levies on certain bank deposits for other troubled countries to secure financial aid could be imposed.

Dijsselbloem later tried clarify his comments, saying in a statement that “macroeconomic adjustment programs are tailor-made to the situation of the country concerned and no models or templates are used.”

But investors remained spooked that the depositor “bail-in” seen in Cyprus may not be a one-time event.

Cyprus secures bailout deal

Cyprus was granted a last-minute bailout from international lenders early Monday after agreeing to restructure and shrink its banking sector, averting bankruptcy. Uninsured deposits — accounts with more than 100,000 euros — could face total losses of €4.2 billion as part of the restructuring.

“Concerns of a bank run are warranted in my opinion, and the spillover to sentiment in other European countries is inevitable,” said Christopher Vecchio, analyst at DailyFX.

The deal struck by Cyprus with the European Central Bank, the European Commission and the International Monetary Fund — collectively known as the troika — cleared the main hurdle to securing 10 billion euros ($13 billion) in crucial financing.

“Overall, this last minute deal avoids the worst-case scenario of a potential bank and sovereign default and Cyprus exiting the euro,” said economists at Barclays in a note.

A Eurogroup statement issued following the deal said “the Cypriot authorities have reaffirmed their commitment to step up efforts in the areas of fiscal consolidation, structural reforms and privatization.”

Initial market reaction was modestly upbeat, but the euro EURUSD, -0.18% gave up earlier gains to trade at $1.2856, down from $1.2980 late Friday in North American trade.

The Stoxx 600 Europe index SXXP, -0.53% fell 0.3% while Italian and Spanish national indexes each lost more than 2%. See: Europe stocks drop on more ‘bail-in’ fears. U.S. stocks finished in the red.

The agreement calls for a restructuring of two of the country’s largest banks — Popular Bank of Cyprus (also known as “Laiki Bank”) and Bank of Cyprus — as well as a downsizing of the nation’s overall banking sector.

Earlier this month, the Cypriot government had announced a one-time tax on all bank deposits, which was eventually voted down by parliament in Cyprus. That left the Cypriot government to scramble to strike a fresh deal with international lenders.

Markets grew jittery last week, particularly after the European Central Bank said it would cut off an emergency liquidity lifeline to the country’s banks unless a deal was in place by Monday.

While Cyprus accounts for just 0.2% of euro-zone economic output, the crisis stirred fears of contagion, particularly after policy makers initially moved to put a levy on all deposits, including insured holdings of less than €100,000.

Cyprus may haunt region

Economists said the Cyprus episode may come back to haunt euro-zone policy makers if the crisis heats up again in another, larger member country.

Ratings agency Moody’s Investors Service, in a note, said the Cyprus crisis was credit negative for all euro-zone sovereigns and that policy makers’ willingness to “bail in” depositors was credit negative for euro-zone banks.

Most of the policy focus fell on the outsize banking sector, which IMF Managing Director Christine Lagarde described as “the heart of the problem” and said needed to be reduced.

As part of that process, Laiki Bank will be split up immediately, “with a full contribution from equity shareholders, bondholders and uninsured depositors.”

Earlier Monday, Dijsselbloem acknowledged that the deal marked the first time that senior bondholders had been hit in the euro zone but said “it’s a unique and exceptional situation” that concerned a bank that needed immediate help.

“Over the last week, the situation in Cyprus and its two banks deteriorated,” he said.

Laiki Bank will be split into a “good” and “bad” bank, with the bad bank to be run down over time, he said.

The good bank will be folded into Bank of Cyprus, and all insured deposits will be moved to Bank of Cyprus, as well as the good assets, Dijsselbloem said.

Uninsured deposits at Laiki, comprising those totaling more than €100,000, amount to €4.2 billion, all of which would be put in the bad bank, Dijsselbloem said.

The Eurogroup leader said officials had yet to decide on the depth of a haircut on noninsured deposits held at Bank of Cyprus.

“We haven’t put a figure on that. We’ve said that the outcome will have to [result in] a bank with a capital ratio of about 9% so we are sure that it’s a solid bank,” he said.

The amount will have to be worked out over the coming weeks by the Cypriot authorities and the troika, he said.

The €10 billion of aid to be made available for Cyprus won’t be available to recapitalize Laiki or Bank of Cyprus, he said.

One of the sticking points in earlier discussions between Cyprus and Europe was thought to have been the large amount of money in Cypriot banks from nondomestic depositors, mainly from Russians.

Dijsselbloem said he was “convinced that this solution is better than the one we reached last week, as we have now been able to focus much more on the problems where they have arisen, and that’s mainly at the two large banks.”

“It’s very much a concentrated approach,” he said of the new deal. “I think that will be much more effective, which will allow the rest of the banking sector in Cyprus to recover from the uncertain period it has been in.”

Laiki and the Bank of Cyprus were expected to remain closed while smaller banks in the country were expected to reopen on Tuesday.