Eurozone Crisis - Light at the end of the tunnel?

There were three major strands to the deal:

Greek debt

Banks holding Greek debt will accept a write-off of 50% of their debts.

This is expected to cut the nation's debt load to 120% of its GDP in 2020.

The banks had initially offered a 40% "haircut", but the deal was finally agreed after German Chancellor Angela Merkel and French President Nicolas Sarkozy joined the negotiations on the issue on Thursday morning.

The eurozone and International Monetary Fund (IMF) - which have both been providing the country with loans since May 2010 - would give Greece another 100bn euros (£87bn: $139bn).

Bailout fund

The European Financial Stability Facility (EFSF) - is to be increased from the current 440bn euros to 1tn euros.

The framework for the new, increased fund should be in place in November.

Bank recapitalisation

European banks will be required to raise about 106bn euros in new capital by June 2012.

It is hoped that this would help shield them against losses resulting from any government defaults and protect larger economies - like Italy and Spain - from the market turmoil.

"We have reached an agreement which I believe lets us give a credible and ambitious and overall response to the Greek crisis," stated Nicolas Sarkozy.