Spain bows to inevitable, will seek bailout

Spain will be fourth euro nation to ask for help. Bailout will be for Spain's troubled banking sector, so no added austerity measures are expected.

|
Albert Gea/Reuters
An ember traffic light is seen in front of the Catalunya Caixa bank headquarters in central Barcelona, June 9, 2012. Spain says it will ask

Spain will ask for a bank bailout from Europe, becoming the fourth and largest country to seek help since the single currency bloc's debt crisis erupted.

Economy Minister Luis de Guindos said Saturday the aid will go to the banking sector only and so would not come with new austerity conditions attached for the economy in general.

He gave no figure as to how much Spain will request, saying that he would wait until independent audits of the country's banking sector have been carried out before asking for a specific amount.

De Guindos did say, however, that Spain would request enough money for recapitalization, plus a safety margin that will be "significant."

The money will be funneled through an existing bailout fund called the FROB.

De Guindos said that with markets in turmoil, the government's efforts so far to shore up the financial sector — through new provisioning requirements — "Must be completed with the necessary resources to finance the needs of recapitalization."

"Therefore, the Spanish government states its intention to request European financing for the recapitalization of banks that need it," the minister told a press conference after a videoconference with colleagues from the 17-member eurozone.

A statement issued after that meeting said up to €100 billion would be made available to Spain.

The Spanish acceptance of aid for its banks is a big embarrassment for Prime Minister Mariano Rajoy, who said just 10 days ago firmly that the banking sector would not need a bailout.

You've read  of  free articles. Subscribe to continue.
Real news can be honest, hopeful, credible, constructive.
What is the Monitor difference? Tackling the tough headlines – with humanity. Listening to sources – with respect. Seeing the story that others are missing by reporting what so often gets overlooked: the values that connect us. That’s Monitor reporting – news that changes how you see the world.

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.

QR Code to Spain bows to inevitable, will seek bailout
Read this article in
https://www.csmonitor.com/Business/Latest-News-Wires/2012/0609/Spain-bows-to-inevitable-will-seek-bailout
QR Code to Subscription page
Start your subscription today
https://www.csmonitor.com/subscribe