FXstreet.com (Barcelona) - German Chancellor Angela Merkel said during the last day of the EU summit in Brussels that Spanish banks could not count on back-dated recapitalization via the ESM.

“If recapitalization is possible, it will only be possible for the future so I think that when the banking supervisor is in place we won't have any more problems with the Spanish banks, at least I hope not," the German Chancellor told reporters during a press conference.

Merkel added that distressed lenders could be directly recapitalized through the ESM as soon as a fund which banks pay into had been established.