Data provided by McGregor BFA
All data is delayed
Loading...
See More

Spain makes formal banking aid request

Jun 25 2012 10:45 AFP

Related Articles

New dangers lurk for rudderless Spain

Spain's rescue loan sows debt fear

French PM: Right decision to help Spain

Spain expected to seek bank aid

Spain's banking backlash

Spain debt woes spur flight from risk

 

Madrid - Spain formally requested a rescue loan of up to €100bn from its eurozone partners in a letter released Monday.

No new figures were included in the letter, after reports by independent consultants last week said stricken Spanish banks could need up to €62bn to survive a severe, three-year financial slump.

Spain's government viewed the loan offer from its partners "very favourably," Economy Minister Luis de Guindos said in a letter addressed to Eurogroup head Jean-Claude Juncker.

De Guindos said Spain's authorities would offer "all their help" in deciding the loan's eligibility criteria, conditions, required measures and contract definition.

The aim was to finalise a memorandum of understanding in time for it to be discussed at a July 9 meeting of the Eurogroup, which groups the 17 eurozone finance and economy ministers.

Spain's economy minister confirmed in the letter that the money would be funnelled to needy banks through the state-backed Fund for Orderly Bank Restructuring (FROB).

De Guindos said the ministers should use as a "starting point" an IMF report on Spain's banks, alongside the findings of international consultants Roland Berger of Germany and Oliver Wyman of the United States.

Their audits tested 14 top banking groups in a likely "baseline" scenario and a "stressed" outcome of a slumping economy and real estate sector.

They found that in a stressed scenario lasting three years, the banks would need €51bn - €62bn in extra capital.

In a baseline case they would need just €16bn - €26bn.

spain  |  banks  |  europe debt crisis
NEXT ON FIN24X

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Add your comment
Comment 0 characters remaining
 

Company Snapshot

We're Talking About: Small Business

Standard Bank is looking for 12 entrepreneurs to participate in a 10-part TV series. They could win a R1m investment into their dream.
 

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...
Loading...