Spanish banks 'need more money' to cover property losses
Last Updated on Friday, 25 May 2012 01:38 Friday, 25 May 2012 01:36
Spanish banks need to secure additional funding to cover losses on property in the nation, experts have claimed.
According to the Institute of International Finance (IIF), the macroeconomic outlook for the European country is less favourable than that for Ireland.
Limited growth and unemployment were flagged up as two of the biggest problems facing Spain at the moment.
However, losses on loans for Spanish real estate are also a big issue, with estimates from the IIF indicating they could be as much as €260 billion (£209 billion).
The organisation believes that while about €184 billion has already been raised to cover these debts, the remainder is still outstanding.
As a result, the government may be required to offer financial support to secure the future of the affected banks.
Earlier this month, Oliver Wyman and Roland Berger were appointed by the Ministry of Economic Affairs and Competitiveness and the Banco de Espana to value the balance sheets at Spain's banks.