Monday, May 07, 2012 5:54 PM – By Mike Shedlock
After insisting no bailouts would be needed, Spain to spend billions on bank rescue
Spain is planning a state bail-out of Bankia, the country’s third biggest bank by assets, in a move likely to involve the injection of billions of euros of public money into the troubled lender.
In an abrupt reversal of policy, the Spanish government, which had previously insisted that no additional state money would be needed to clean up the country’s banking sector, confirmed that an intervention was being prepared.
Some bankers and analysts have argued that BFA, Bankia’s parent company which controls the listed entity and houses the combined group’s worst quality assets, needs significantly more capital.
Thanks to BrotherJohnF