 |
| Spain's main bank "Bankia". |
The decision was made by EU finance minister during talks.
Spain's Economy Minister Luis de Guindos stressed that the help would be for the banking system , not the economy.
Spain's government were reluctant to ask for a bailout similar to Ireland, Portugal and Greece because they came with spending cut demands from other EU nations.
The conditions attached to Spain's bank bailout were described by De Guindos as "micro-economic conditions".
The exact amount that Spain will receive will be decided after two audits of its banks, set for completion by the end of month.
The money will help the finances of Spain's weakest banks, which have been left with billions of euros worth of bad loans because of the collapse of the country's property market and the recession that followed.
House prices have fallen by 25% on average, this is one of the reasons for the banks failing.
Spain put 34bn euros into the banking system in an attempt to strengthen it. Spain recently nationalised Bankia, its fourth largest bank.
Spain was very keen to ensure that any money went directly to its banks, rather than to the central government.
Will the need for bailouts stop at Spain? Or can it only get worst for the EU?
Also in the news ...
- Floods hit England and Scotland .
- The number of confirmed and suspected cases of Legionnaires' disease in Edinburgh has risen to 80.
- Prince Phillip leaves hospital today after treatment for a bladder infection.
- 11 arrested at EDL protest
- China puts new manned rocket into space
