Spanish Banks Seek Record Amounts From ECB

This just in from Spain for inquiring minds:

Spain’s banks borrowed a record 130.2 billion euros (167 billion dollars) from the European Central Bank in July, the Bank of Spain said Friday, in a sign they continue to struggle to get market financing.

The amount constituted almost 30 percent of the 447.5 billion euros in loans handed out by the ECB last month in financing for eurozone banks, a figure which was down from 496.7 billion euros in June.

Borrowing by Spanish banks from the ECB was up up 3.1 percent from June and 77.7 percent higher than in the same month last year, the Bank of Spain said.

It was the fourth straight month that the banks had asked for more funds from the ECB and the highest amount borrowed since the Bank of Spain began releasing such figures in 1999.

The deputy chairman of the Bank of Spain, Javier Ariztegui, said in June that Spanish banks since April had been forced to seek more liquidity from the ECB due to nervousness in the markets over the country’s economy.

The banks hope to see confidence return in the coming months following the positive results of stress tests for Spanish banks last month.

All eight major Spanish banks passed the EU’s bank stress tests on their ability to weather a crisis although five out of 19 regional lenders failed.


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