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5 Jul 2013
Further aid for Spanish banks currently unnecessary
FXstreet.com (Barcelona) - The European Commission and the European Central Bank released a document today in which they assure that at present Spain does not need further EU aid to prop up its banks.
Spain has already received over 41 billion euros of bailout funds for the recapitalization of its banking sector, with the possibility of covering financing needs of up to 100 billion euros, should the need arise. International lenders believe however that the austerity program implemented by Spanish PM Mariano Rajoy helped stabilize the economy sufficiently to render further aid unnecessary for now.
Nevertheless woes remain, as the IMF experts, who also contributed to the report point out. "A prolongation of the negative trends in unemployment, real incomes and solvency of companies beyond current expectations will heighten risks particularly for weaker banks," they warned.
The IMF recommended carrying out reforms to boost growth and employment to avoid destabilization in the future.
Spain has already received over 41 billion euros of bailout funds for the recapitalization of its banking sector, with the possibility of covering financing needs of up to 100 billion euros, should the need arise. International lenders believe however that the austerity program implemented by Spanish PM Mariano Rajoy helped stabilize the economy sufficiently to render further aid unnecessary for now.
Nevertheless woes remain, as the IMF experts, who also contributed to the report point out. "A prolongation of the negative trends in unemployment, real incomes and solvency of companies beyond current expectations will heighten risks particularly for weaker banks," they warned.
The IMF recommended carrying out reforms to boost growth and employment to avoid destabilization in the future.