EU agrees to lend Spain up to €100 billion
11 Jun 2012
The European Union ministers have agreed to bailout Spain, the eurozone's fourth biggest economy, by lending €100 billion for recapitalising its struggling banks.
The exact amount that Spain will receive will be decided after the completion of two audits of its banks, due to be completed by the end of June.
Spain thus became the fourth member country in the eurozone after Greece, Ireland and Portugal to ask for assistance since the beginning of the European debt crisis.
The loan will bolster Spain's weakest banks, left with billions of euros worth of bad loans following the collapse of a property boom and the recession that followed.
The money will come from either of the two funds created to help eurozone members in financial distress - the temporary €440 billion the European Financial Stability Facility (EFSF) or the permanent €500 billion European Stability Mechanism (ESM), which is expected to be introduced in July.
The Spanish prime minister Mariano Rajoy was enthusiastic about the move, but painted a gloomy picture on the country's immediate future.
