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Spain's plans to save the savings banks

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Spain's plans to save the savings banks

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Spain’s government has created an emergency rescue fund for the country’s financial sector. It has allocated nine-billion euros to help facilitate re-organisation among financial institutions, in particular the numerous regional savings banks.

The Economy minister, Elena Salgado said: “It’s really an appropriate time to make sure that the savings banks are strong enough to see through the process of merger, takeover and consolidation.” Spain’s main banks were relatively-speaking spared from the effects of the American sub-prime lending collapse that sparked the worldwide credit crunch. But the savings banks have been widely exposed to the crisis in Spain’s own property market.