With a 100bn euro rescue of Spain’s banks agreed, Channel 4 News looks at the deal Madrid has struck with its European partners and the implications for Greece and Ireland.
Stock markets across Europe and Asia rally on news of Spain’s 100bn euro banking bailout, after the country’s economy is hit by the collapse of the property market.
Spain will ask for an estimated 40-100bn euros from Europe to keep its banks operating – but it may not know the extent of the crisis until mid June when two audits are completed.
Spain is expected to ask Europe today for money to recapitalise its banks. But one credit ratings agency says the country will need significantly more than the IMF’s estimated 40bn euros.
Spain seems to have played hardball and won some concessions. The medium term changes to strategic thinking are happening right now. And they will have a profound impact here.
Spain has denied claims its banks need an urgent bailout as EU plans are announced to halt taxpayers’ money being used to bail out failed banks.
Spanish Economy Minister Luis de Guindos issues a dire warning about the future of the euro, as new figures show 66bn euros ($82bn) of money left the country in March.
Mario Draghi, president of the European Central Bank, criticises Spain for underestimating the problems faced by Bankia, the troubled nationalised bank.
Business correspondent Sarah Smith gives a numerical guide to just how bad the Euro-crisis looks in Spain.
Europe is threatened by an acute crisis in Spain’s banking system and predictions seen by Channel 4 News suggest a 50 per cent fall in house prices could force Spain to seek an international bailout.
Lindsey Hilsum
“Maybe we’re going to hell,” said Irene Lozano, an independent Deputy in the Spanish Assembly. “But if we do, we’ll take Germany with us.”
The FTSE 100 index opens 44 points down after Moody’s cuts the credit ratings of 16 Spanish lenders, including the UK arm of Banco Santander.
The Spanish government denies that customers have withdrawn one billion euros from their accounts after shares in Spanish bank Bankia fall 25 per cent on Thursday as worries mount over its future.
Spain partially nationalised banking giant Bankia SA after concerns about its real estate exposure in a scenario reminiscent of the Irish crisis following the 2008 implosion of Lehman Bros.
With voters in Greece, France and Italy using elections to reject austerity, Channel 4 News looks at what happens next and whether a break-up of the eurozone is now on the cards.