The Euro group announced Saturday June 9 a ceiling of 100,000 million euros

After the incessant rumors in recent days, on Saturday June 9 cleared all doubts: Spain needs of Europe to save its financial system. The International Monetary Fund , in an exercise of responsibility and to avoid havoc in the markets, ruled in the early hours of Saturday to confirm the need for Spain to intervene to rescue of the financial sector in the country.

IMF: “The Spanish banks need at least 40,000 million euros”

The International Monetary Fund two days ahead of the publication of the Government of Mariano Rajoy needed to address the need of a bailout. The IMF has been clear, Spain needs the order of 40.000 million euros, at least to rescue their battered banks and remarks that this figure could see increased since, “there are significant vulnerabilities in the system.”

One of the interesting parts of the IMF paper is the classification that makes the Spanish banking system. The Fund has four different types: the first internationally diversified banks, second former savings banks now converted to commercial banks that have shown resistance to the crisis, and thirdly the old boxes that have requested access to Fund Bank Restructuring and finally commercial banks that are now administered by the public sector. These two types account for all the needs of capital released Saturday by the IMF.


The troika we have monitored

Although a rescue the financial system exclusively, Spain will have to be monitored to fulfill the objectives. Brussels and Germany have been very clear that there will be a troika responsible for supervising the entire process. This group will consist of the European Union Commission (EC), the International Monetary Fund (IMF) and European Central Bank (ECB).

No more cuts “safe surprises”

On the morning of Monday June 11, Deputy Secretary General of Organization of the Popular Party, Carlos Floriano, said the bailout does not mean more adjustments for the citizens, unless there appear “more surprises” in the public accounts. These statements were made ​​in an interview on National Radio where Floriano hoped that “it is not necessary to take no further action” but notes that the Mariano Rajoy reformist project “can not stop” . Many experts have called “soft recovery” because although Europe will needs to Spain, they will not be as severe as those who have suffered Greece, Portugal or Ireland. It will be because it is not an aid to the Spanish State but is directed only to a portion of their financial institutions.

Another of the great fears of many citizens is in their savings. Experts say that these may be even quieter than before since the requirements will be directed mostly to the very entities that take public money. It seems that may take place in limitations on the salaries of managers, the prohibition of dividends, in setting shorter deadlines for cleaning up their toxic assets and severe restructuring plans.

Europe breathed by the Spanish decision

The European Union did not want to pressure Spain to request feedback support but this was necessary and desired by all. This has been done to know the major European leaders praising this hard and difficult decision. So much so that the European Commission is willing to “negotiate away the conditions for the financial sector,” said Olli Rehn, Commissioner for Economic Affairs.