Spanish banks must detail by yr-end plans to raise funds
Spanish banks must outline by the end of the year how they plan to raise the billions of euros needed to meet higher capital demands imposed by the EU, the Bank of Spain said Wednesday.
Leaders at an emergency summit in Brussels last week called on banks to raise their core capital ratio -- a key measure of their financial health -- to nine percent of their overall assets by June 30, 2012.
The European Banking Authority (EBA) regulator calculated at 26.16 billion euros the amount Spain's five biggest banks will need to raise to meet the new capital requirements.
"The entities must detail their plans on how to reach (the new capital requirements) by the end of 2011, and they must be agreed with national supervisory authorities, the Bank of Spain in the Spanish case," the Bank of Spain said in its twice-yearly 'Report on Financial Stability.'
Spanish banks have vowed not to seek public aid to raise the funds needed to meet the new capital requirements.
Santander, the eurozone's biggest bank by market capitalisation, needs 14.97 billion euros to meet the new capital requirements, according to the European Banking Authority.
The bank itself insists it could manage with 6.47 billion euros.
The other banks have accepted the EBA's calculations -- 7.09 billion euros for BBVA, 2.36 billion euros for Banco Popular, 1.14 billion euros for Bankia and 602 million euros for La Caixa, owner of Caixabank.
© 2011 AFP