Ακολουθεί η ανταπόκριση, όπως δημοσιεύεται στην ηλεκτρονική έκδοση των Financial Times.
Spain to ask EU for bail out
By Peter Spiegel in Brussels
The Spanish government agreed to seek EU bailout aid for its struggling financial sector on a conference call of eurozone finance ministers Saturday evening.
In exchange, the ministers agreed not to attach any new conditions on Madrid other than its current commitments to abide by tough new EU defeict rules, according to a senior EU official.
Luis de Guindos, the Spanish finance minister, is scheduled to announce the decision at a news conference in Madrid Saturday evening, officials said. Following Mr De Guindos’ announcement, the so-called “eurogroup” of finance ministers will declare they are ready to back Spain with up to €100bn.
Eurozone leaders will not specify whether the money will come from the current €440bn rescue fund, the European Financial Stability Facility, or the new €500bn fund, the European Stability Mechanism. The senior official said it could be a combination of the two, since the ESM is due to go into force next month.
Loans from the ESFS do not have preferred seniority status; under the terms of the ESM treaty, however, loans from the ESM take priority over all private sector debt, potentially spooking Spanish sovereign bond markets.
Although the International Monetary Fund will back the programme with its expertise, it will not loan Spain any money as part of the bailout, a significant break with previous rescues of Greece, Portugal and Ireland. Under its rules, the IMF cannot loan assistance that goes only to banks.
Its funding is intended for governments undergoing full-scale bailouts. Both Spanish and EU officials will make clear that the bailout is narrowly focused on Spain’s banks; as a result Madrid will avoid the kind of intense austerity conditions attached to previous eurozone bailouts.
The decision came after a two-and-a-half hour conference call between finance ministers. It was reachedless than 24 hours after the IMF issued a 77-page report on the Spanish banking sector that found it was suffering through a crisis “unprecedented in its modern history”.
IMF officials recommended new capital injections of at least €40bn, but they noted the weakest banks’ needs “would be larger than this” once all bad loans were accounted for and restructuring costs taken into account.
The decision by eurozone finance ministers to act even before independent auditors hired by Madrid issue a report on the banking sector by June 21 reflected officials’ desire to shore up Spain before the potentially destabilising elections next weekend in Greece.
In its report, the IMF also urged Spanish and European authorities to move quickly, strongly signalling that Madrid has not done enough to inspire confidence in the sector’s strength in its recent handling of the crisis.
“It is critical that the authorities continue to take decisive action to address the weaker institutions and restore market confidence in Spanish banks,” the report urged. “Delays could exacerbate the macroeconomic downturn, erode market confidence, and damage stability more broadly.
The eurogroup announcement came less than 24 hours after the International Monetary Fund issued a 77-page report on the Spanish banking sector that found it was suffering through a crisis “unprecedented in its modern history”. IMF officials recommended new capital injections of at least €40bn, but they noted the weakest banks’ needs “would be larger than this” once all bad loans are accounted for and restructuring costs taken into account.
The decision by eurozone finance ministers to act even before independent auditors hired by Madrid issue a report on the banking sector by June 21 reflected officials’ desire to shore up Spain before the potentially destabilising elections next weekend in Greece.
In its report, the IMF also urged Spanish and European authorities to move quickly, strongly signaling that Madrid has not done enough to inspire confidence in the sector’s strength in its recent handling of the crisis.
“It is critical that the authorities continue to take decisive action to address the weaker institutions and restore market confidence in Spanish banks,” the report urged. “Delays could exacerbate the macroeconomic downturn, erode market confidence, and damage stability more broadly.
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