Spanish Finance Minister Luis de Guindos revealed on Monday ahead of the Eurogroup summit that Spain would need 37 billion euros to recapitalize its nationalized banks.

Bankia, Catalunya Caixa, Banco de Valencia and Novagalicia would be the recipients of EU funds. The Finance Minister added that further 3 billion euros would be used to cover the needs of other financial institutions such as Caja 3 y Caja España Duero as well as for the creation of the bad bank.

Luis de Guindos assured that no inconsistencies with the recapitalization plans as foreseen by the Memorandum of Understanding were envisioned.

As far as talks on Greece are concerned, Spanish Finance Minister expressed confidence that a final deal could be struck today. “It is crucial to reach agreement, it would be a message of confidence, not just for Greece, but for the whole euro zone,” Luis de Guindos emphasized.

Eurogroup meets to discuss Greek aid


Eurozone finance ministers gather on Monday for the third time this month to try and reach an agreement on the Greek bailout. The main points on the agenda are the unfreezing of the next tranche of rescue funds and the possible debt write-off.

European Commissioner for Economic and Monetary Affairs Olli Rehn told reporters on Monday that it was of utmost importance to remove the uncertainty surrounding the Greek situation and he expressed his conviction that reaching a final decision this time was “fully possible”.

Jacqui Douglas, Senior Global Strategist at TD Securities is not as certain that the deal will be struck: “Markets seem to have fully priced in a deal getting done today, but we worry that they could be disappointed, as we’ve seen reports that the decision on Greece could get pushed back to the Eurogroup meeting on 3 Dec, as there is still a big gap in opinions to bridge. Yet another delay could push the markets to take back a big part of last week’s gains in EUR/USD and risk assets in general.”