James BryceSPAIN will need between €51-62 billion to shore up its ailing banking sector, according to the results of an official audit.
The announcement comes just days after world leaders used the G20 summit in Mexico to urge Spanish Prime Minister Mariano Rajoy to seek a formal bailout from the EU.
Following the results of the audit, Spain’s economy minister Luis de Guindos confirmed that he will request the rescue fund within days.
Spain recently agreed a €100 billion rescue package for its banks, which are struggling with billions of euros of debt linked to the collapsed property market.
But the review of the country’s books has revealed that the actual figure required by Spain is more likely to be around half of the provisional agreement.
Speaking at the conference in Mexico before the audit results were made public, German Chancellor Angela Merkel said: “All agreed that once the audit results were available, then Spain should make its application as soon as possible.
“We also talked about how we need clarity on Spain’s application. We all know that banks that are not properly capitalised are the source of turmoil and risk for the economy.”
This estimate of ONLY BANK bailout is too low – likely done by a Spanish firm. That’s why Rajoy requested detailed audits done by USA & German accounting firms.
Surely nice that the Bank Execs are being compensated/bailed out for their performance in “managing” risks/rewards for their Depositors and Shareholders.
And since the Government is overspending they need a separate Bailout from the Banks.
Banks are PRIVATE firms, so after Spain arranges huge bailouts for Banks – they should do the same thing for OTHER PRIVATE firms in Spain…. is there enough money in the World, especially since Germany & UK won’t contribute?