Spain sees up to 50 bn euros in bank bad loans

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Spain's battered banks will need to set aside up to 50 billion euros ($65 billion) in extra bad loan provisions, the new economy minister said in an interview published Thursday.

"If you take international valuations as in the case of Ireland, at the most you are talking about the need for 50 billion euros of extra provisions (for Spanish banks)," Economy Minister Luis de Guindos told the Financial Times. "In the great majority of cases, they can provide it themselves from their profits, and it could be done not in one year but over several years."

The minister also said Spain's austerity programme will target the regions, with a new law in March introducing strict control over their budgets. "You will have a priori controls. Before approving the budget, ministers will need the green light from the central government," he said.

© 2012 AFP

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