Bloomberg News

Guindos Bats Away Bailout Talk as He Calls for Banking Union

June 06, 2012

Spanish Economy Minister Luis de Guindos batted away questions on whether Spain would seek a bailout for its banks as he called for greater integration in the euro region’s financial industry.

De Guindos declined to answer four questions today from reporters in Brussels on whether Spain would seek a bank rescue after he met European Parliament members at a closed-door meeting. Asked about a report in Sueddeutsche Zeitung that European rescue funds may be lent to Spain’s bank-bailout fund, de Guindos said European lawmakers hadn’t asked him about it.

“There wasn’t the least issue, the least question about a bailout,” he told reporters.

Spain backs more integration in the 17-nation euro area’s financial industry, including joint deposit guarantees and empowering the rescue fund to recapitalize lenders, de Guindos said. Germany opposes direct injections from rescue facilities; the rules say aid has to be channeled via governments.

The health of Spanish lenders will be clear in 10 to 15 days, when two international consultants publish stress tests on lenders’ loan books, de Guindos said. The government expects those results to chime with an International Monetary Fund report in April that said most banks would be resilient to shocks, he said.

“After that, the government will take the necessary decisions, obviously from the point of view of recapitalization of institutions,” de Guindos said.

To contact the reporter on this story: Emma Ross-Thomas in Madrid at erossthomas@bloomberg.net

To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net


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