Spain may need 62 bn euros
June 21, 2012
Spain's banks could need up to 62 billion euros if they are to be sufficiently recapitalized, an independent audit for the government revealed on Thursday.
The governor of the Deputy Bank of Spain Fernando Restoy presented the results of audits into the country's banking sector, which reveal that the highest estimation for Spain's requirements were far less than the 100 billion euro aid package that the eurozone offered the country earlier in the month.
One of the audits, carried out by US company Oliver Wyman, found that if the economy does not fare well then it could need between 51 and 62 billion euros. Though the firm found that if the economy performs as expected, it would require between 16 and 25 billion euros. A different auditing firm, Roland Berger, put the figure at 25.6 billion euros in a “normal” scenario and 51.8 billion euros in the worst-case-scenario.
The country is expected to consider the findings when considering how big a bailout loan it should request from the eurozone. The formal request will be made by Spain “in coming days” said Finance Minister Luis de Guindos at a eurozone meeting in Luxembourg on Thursday.
Spanish banks have been struggling under the weight of their toxic loans since the country's property bubble burst five years ago. Market concerns that Spain cannot support its banks without international aid has caused its borrowing costs to rocket to levels not experienced since it joined the euro at the currency's inception in 1999.
sej/msh (dpa, AP)