The loan will be supervised by the European Commission, the European Central Bank and the IMF, Almunia said.
A European Commission spokesman, Amadeu Altafaj, told Spanish state television that this troika will have people on the ground overseeing the restructuring of the Spanish financial sector. Representatives of the same three groups regularly visit Greece, Ireland and Portugal to make sure the governments in those nations are complying with bailout terms,
Altafaj noted that the European Commission last month recommended Spain undertake further reforms such as speeding up the phasing of a higher retirement age â¿¿ it is to go from 65 to 67 â¿¿ and raise VAT sales tax. The newspaper El Pais quoted EU officials Monday as saying these changes and others are part of the conditions that come with the bank rescue package.
Adding to the gloomy mood on Monday, the Fitch Ratings agency downgraded the credit rating of Spain's two largest international banks Banco Santander SA and Banco Bilbao Vizcaya Argentaria SA from A to BBB+.The agency said the reasons for the downgrade were primarily because Spanish credit rating was downgraded to two notches above junk last week, because of a fresh forecast that Spain's faltering economy will remain in recession into 2013 "compared to the previous expectation that the economy would benefit from a mild recovery in 2013." Banco Santander and BBVA are seen as immune from needing help from Spain's bank bailout because profits from their international operations have buffered their Spain losses. But Fitch also said they could be affected by any downturn that affects operations outside Spain. Both are big players in Latin America. "Growth prospects for emerging markets in which Santander and BBVA subsidiaries operate have been revised down and they are not entirely immune to global economic trends but earnings from these markets will continue to contribute significantly to group earnings at both institutions," Fitch said in a statement.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV