The amount of bad debt held by Spain’s already crippled banks rose to a record high in September according to official figures.
But the government is predicting the sector will need less than half of the money made available in a euro zone rescue package.
The Bank of Spain said Spanish banks were holding more than 182 billion euros worth of bad debt in September. In other words, 11 per cent of their loans are in arrears.
The euro zone has set aside a credit line of 100-billion euros – an independent audit recently concluded that Spain’s banks would need 60-billion euros of capital injections.
Now, the deputy economy minister believes they’ll need less than 40-billion.