The ministers also approved ⿬2.5 billion to help fund Sareb, Spain's recently set-up bad bank.

Many analysts think that Spain's banks will need much more over the months ahead to deal with their myriad of problems. In September, an independent audit commissioned by Spain estimated that the country's troubled banks would need ⿬60 billion to survive a serious downturn.

"One can't help feeling that the amount being asked for could be one of many requests over the coming months," said Michael Hewson, markets analyst at CMC Markets. "With the aid being conditional on sweeping job cuts in excess of 6,000, and bank branch closures across the country the effects are likely to be felt across the entire Spanish economy, which is already seeing tax revenues shrink sharply."

Another four banks ⿿ Mare Nostrum, Banco Caja 3, Liberbank and Ceiss ⿿ were found in audit to be not fully capable of surviving a serious economic downturn. They are due to present restructuring plans before Dec. 20 in order to receive rescue funds. On Monday. Spanish Economy Minister Luis de Guindos applied to the eurozone for ⿬1.5 billion for these banks.

In a positive signal for Spain's deficit-reduction efforts, the country's 17 semiautonomous regions managed to improve their finances in the first nine months of the year.

The Finance Ministry said their joint deficit stood at 1.14 percent of Spain's gross domestic product at the end of September. In the same period last year, it was 2.2 percent and ended 2011 at 3.3 percent, contributing to Spain's debt woes. The central government has set them a target of 1.5 percent for 2012.

Copyright 2011 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

If you liked this article you might like

What's Behind the Surge in Energy Stocks

Hillary Clinton Says Prosecuting Individuals is Key to Wall Street Reform