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EU and Madrid play down Spain bailout rumours

EU and Madrid play down Spain bailout rumours
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There are reports that Spain is expected to ask the eurozone this weekend for help for its stricken banks.

According to Reuters, EU and German officials have said Euro Group finance ministers will hold a conference call on Saturday to discuss it.

If true, Spain would be the fourth country to seek assistance since the crisis began.

In Madrid and Brussels they have been playing down the reports.

The Spanish Deputy Prime Minister Sáenz de Santamaría said nothing was planned at the moment and they were waiting for the results of independent audits.

“The government has to respect the procedures before taking any decision about the figures. Once we know more about the money our financial system may need, the Government will communicate its position,” she told a news conference.

The EU Commission said if a request came from Spain, the eurozone was ready to respond.

But it insisted no such request had been made, and wouldn’t say whether a conference call was planned.

“We don’t know anything about a request for aid from the Spanish authorities, so we are not even thinking about organising a meeting of the eurogroup,” said the Commission’s economic affairs spokesman Amadeu Altafaj.

The reports come a day after one agency cut Madrid’s sovereign credit rating by three notches from A to BBB.

Fitch said the cost to Spain of recapitalising banks damaged by a property crash, recession and unemployment could be up to 100 billion euros.