1 Oct 2012

Spain's banks may need 59.3bn in eurozone loans

3:30 pm on 1 October 2012

Spain's banks will need an injection of €59.3 billion to survive a serious downturn, an independent audit has calculated.

The amount is broadly in line with market expectations and follows so-called stress tests of 14 Spanish lenders, the BBC reports.

Spain said in July that it would request eurozone support for its banks.

Much of the money is expected to come from the eurozone rescue funds.

The audit calculation that Spain's banks will need 59.3bn euros is a worst-case scenario, and does not take into account any future plans by the lenders themselves to raise their own capital.

The country's economy minister Fernando Jimenez Latorre indicated that it may need to borrow about 40bn from the eurozone rescue funds.

The Spanish banking sector has been in difficulty since the global financial crisis of 2008, and the subsequent bursting of the country's property bubble and deep recession.