Cypriot Finance Minister Michalis Sarris has resigned citing his role as chairman of Laiki Bank, whose failure was a major contributor to the island's near financial meltdown, as one of the reasons behind his decision. 

His resignation on Tuesday was accepted by President Nicos Anastasiades, presidential spokesman Christos Stylianides said.

Sarris' resignation comes after agreeing to the terms of a $13bn bailout from the International Monetary Fund and the European Union. The minister has faced strong criticism for his handling of negotiations with Cyprus's international creditors.

Earlier on Tuesday, the government launched a judicial probe into how the island was pushed to the verge of bankruptcy before having to agree to a crippling eurozone bailout.

Sarris, who headed the country's now defunct Laiki Bank last year in a bid to save it from collapse, also told reporters he decided to step down to ease the investigation ordered on Tuesday.

The Phileleftheros newspaper reported that he had quit and was to be replaced by Labour Minister Haris Georgiades.

Georgiades's former job is to be taken by commerce ministry civil servant Zeta Emilianidou, the report added.

Source: Agencies