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December 1, 2021

Eurozone ministers agree EUR 30 bln for Spanish banks

Eurozone finance ministers have agreed to lend Spain EUR 30 bln this month to help its troubled banks, BBC informs. It will be the first instalment of a bailout of up to 100bn euros, which was agreed in June. The ministers will need to get approval from their own parliaments and hope to make the payment by the end of July. The eurozone finance ministers also agreed to extend the 2013 deadline for Spain to cut its budget deficit to the EU limit of 3 pc by one year. The yield on Spanish bonds rose sharply on Monday ahead of the meeting, with many fearing that little concrete action on Spanish banks would be reached. “We are aiming at reaching a formal agreement in the second half of July, taking into account national parliamentary procedures, allowing for a first disbursement of 30bn euros by the end of the month to be mobilised as a contingency in case of urgent needs in the Spanish banking sector,” Eurogroup President Jean-Claude Juncker said. “There will be specific conditions for specific banks, and the supervision of the financial sector overall will be strengthened,” he added. The exact amount that Spain needs for the bailout of its banks may not be known until September. Juncker also said that Madrid should implement measures needed to bring its public finances into line with EU norms.

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