Up to 60bn euros (£48bn; $78bn) will be needed to bail out Spain's banks,
according to the country's second biggest lender, BBVA. The results of
independent stress tests of the Spanish banking sector will be published on 28
September. But previews are already being sent to the country's financial
institutions. The BBC has been told that the Spanish government has already
put in place economic reform plans that would allow it to apply for a bailout
immediately. Spain's conservative Prime Minister Mariano Rajoy has in the past
insisted Madrid would not become the fourth European capital in recent years to
apply for such a bailout, but sources indicate such a programme is now likely.
Spain's banking sector needs recapitalizing, and much of the money would come
from 100bn euros in European Union funds already pledged by eurozone finance
ministers in June. "We'll get a figure of around 70, 75 or 80 billion euros,"
BBVA's Chairman Francisco Gonzalez said. That figure includes around 20bn euros
already allocated to troubled banks, which means 50-60bn euros is still
required. The bigger question however for investors is how the Spanish
government begins to balance its books. Many in Brussels and beyond now assume
it is only a matter of time before Spain becomes the fourth eurozone country to
take a bailout. A source in Brussels said the preference is that Madrid applies
for the money sooner rather than later, before market conditions change. That is
important because of the different manner in which this bailout is being put
together. A European Commission spokesman said it would be wrong to see this as
a "kind of proto-bailout" - but to many it does look like a bailout-by-stealth.
Over the last few months Spanish officials have held numerous meetings with
their European counterparts, working out what Madrid would have to do to fulfil
the criteria of any bailout deal. Officials say Spain is already living up to
any future bailout terms. Next Thursday Mr Rajoy will unveil the next Spanish
budget. Rather than more cuts, more austerity, he is pushing for structural
reforms to help him make savings. Such reforms will form the basis of a bailout
agreement with the so-called troika - the European Commission, European Central
Bank and International Monetary Fund. For a program to work, all that would need
to be added would be firm dates for implementing such reforms and a team to
monitor progress. Asked to comment, the Spanish finance ministry did not deny
that negotiations to this effect had taken place. It could give Spain's prime
minister enough wiggle room to present this to his country as a Spanish-led
process. Many will not believe him, but it helps a leader who said he would
never apply for a bailout to save some face. (source BBC)
Access Investments-Building Awareness - European Union-ROMANIA
Friday, September 28, 2012
Up to 60bn euros (£48bn; $78bn) will be needed to bail out Spain's banks,
according to the country's second biggest lender, BBVA. The results of
independent stress tests of the Spanish banking sector will be published on 28
September. But previews are already being sent to the country's financial
institutions. The BBC has been told that the Spanish government has already
put in place economic reform plans that would allow it to apply for a bailout
immediately. Spain's conservative Prime Minister Mariano Rajoy has in the past
insisted Madrid would not become the fourth European capital in recent years to
apply for such a bailout, but sources indicate such a programme is now likely.
Spain's banking sector needs recapitalizing, and much of the money would come
from 100bn euros in European Union funds already pledged by eurozone finance
ministers in June. "We'll get a figure of around 70, 75 or 80 billion euros,"
BBVA's Chairman Francisco Gonzalez said. That figure includes around 20bn euros
already allocated to troubled banks, which means 50-60bn euros is still
required. The bigger question however for investors is how the Spanish
government begins to balance its books. Many in Brussels and beyond now assume
it is only a matter of time before Spain becomes the fourth eurozone country to
take a bailout. A source in Brussels said the preference is that Madrid applies
for the money sooner rather than later, before market conditions change. That is
important because of the different manner in which this bailout is being put
together. A European Commission spokesman said it would be wrong to see this as
a "kind of proto-bailout" - but to many it does look like a bailout-by-stealth.
Over the last few months Spanish officials have held numerous meetings with
their European counterparts, working out what Madrid would have to do to fulfil
the criteria of any bailout deal. Officials say Spain is already living up to
any future bailout terms. Next Thursday Mr Rajoy will unveil the next Spanish
budget. Rather than more cuts, more austerity, he is pushing for structural
reforms to help him make savings. Such reforms will form the basis of a bailout
agreement with the so-called troika - the European Commission, European Central
Bank and International Monetary Fund. For a program to work, all that would need
to be added would be firm dates for implementing such reforms and a team to
monitor progress. Asked to comment, the Spanish finance ministry did not deny
that negotiations to this effect had taken place. It could give Spain's prime
minister enough wiggle room to present this to his country as a Spanish-led
process. Many will not believe him, but it helps a leader who said he would
never apply for a bailout to save some face. (source BBC)
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5 comments:
"The budget included a pledge to enact 43 laws to bring about structural reforms in the next six months"
There is too much of this kind of bullshit that I could in fact legislate with a single law "money trees" and the problem is solved and you don't then need the other 43 laws do you?
This is the problem, avoid facing the truth, then trying to legislate for something that does not work, will never work and in a month of Sundays ever add up.
In this kind of situation you got to face facts...
1. This is a big one ... your bust.
2. There is no real growth in any shape or form other than inflating the system to pretend there is ... "that's just for you Mervyn King BOE".
3. Robbing from the future is a deferal of the problem so you leave it to somebody else to pick up the pieces in the future ... god help the western youth when it is their turn excluding the children of the elite.
4. Best of all there is not enough work "period" in most western economies to employ enough people full time so they can support themselves ... this is the technological efficiency of
the system to produce overtaking the ability to consume.
Now my betting and having not read the laws that all the 43 new bits of legislation will go against the above facts to pretend everything is working out just fine.
It ain't, it won't and you better get used to the new reality.
Brave people of Spain rise up and rebel against the banker occupation. These are not your debts to pay, they are debts of fraudulent private banks, it is theft plan and simple. Sheeple of the UK wake up you are next the derivatives bubble is worth trillions and these fascists will steal every penny you have and sell every public service you hold dear to cover the debts of fraudsters and criminals.
When governmnet supports criminal and oppressed honest people then rebellion becomes a public duty - Mahatma Gandhi
just how dumb can these zealous fanatics of the EU project be ?
announcing 20 Bill. in cuts is one thing - getting it actually done is another
state spending cuts, well yes, not necessarily the jobs, but cut in the inefficiencies and corruption would save that 20 Bill. ( as it would in any european country including GB and D ) without the loss of livelihood for millions of decent law abiding families
DO NOT RAISE TAXES
this debilitates once again the private part of the economy as well, leading to less economic output to finance the public sector
It doesn´t work in Latvia, it doesn´t work in Greece, and it won´t work in Spain. and makes the markets even less sceptical that they will get out of the hole which the zealots of the EU and it´s dysfunctional currency has dug for the proud and peaceful Spaniards
not just by Einsteins definition, but by all definitions, these people are insane
it´s the money system, stupid
This austerity will just make the economic situation in Spain worse. It will then end up in dragging Italy down with it too. Then the French et al,. They could not have mishandled this situation any worse if they tried.
All the recent measures are doing is creating economic serfdom across the Latin block; similar to how the IMF have been trapping third-world countries in debt-dependency throughout their cack-handed leadership.
Meanwhile, the debt liabilities have been shifted onto the taxpayers of Europe via the wholly anti-democratic ESM, and the EFSF.
Whether it’s the banks that fail and collapse with your deposits too. Whether it’s the bailouts of these institutions using your taxes. Whether its the public debt taken out in the names of your children, whether it’s the bailout given out in the name of your neighbour's children. Whether it's the government devaluing your savings, and destroying your pension. Whether it's wreckless gambling by those abroad or at home with money that isn't theirs. It is always the Taxpayer who will pay.
Description by Kathimerini of the cuts agreed by the Greek coalition:
* pension cuts: suppression of the last holidays payment for all pensioners, so this is equivalent to 1/13th diminution of the yearly payment. This had already been reduced to a maximum of 800 euros. Plus 2% cuts to pensions between 1000 and 1500 euros, 5% cut between 1500 and 2000 euros, 10% above 2000 euros.
* increase in retirement age from 65 to 67
* wage cuts to civil servants of up to 10%, and for people working at public enterprises, cuts between 20% and 30%. Policemen and soldiers will also see cuts, between 6 and 23%. Also suppression of the holiday payment that was already limited at 1000 euros.
* end of the 5000 euros tax-free threshold for self employed
Spending reductions make 10.5 bill, with 6.5 bill coming from pensions, wages and benefits cuts. The 4 bill other spending reduction are not precised. Tax increases make 3 bill. Initial plan was to have 2 bill of tax increases and 11.5 billions of cuts instead. Those revenues are accounted on two years, or four if the troika agrees to extend. Up to 8 bill euros have to be implemented next year.
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