Business World

Saturday 23 September 2017

Fitch fears Spanish bill could hit €100m

Donal O'Donovan

Donal O'Donovan

Spain's banks are likely to need €50bn to €60bn to cope with loan losses, less than the cost of bailing out the much smaller Irish banks, according to ratings agency Fitch.

Last weekend the Spanish government bowed to pressure from other euro states to accept a bailout deal to bolster its ailing banks.

Spain has delayed hammering out the details of the package until the government there can come up with an estimate of the financial needs of its banks.

In a report published yesterday, Fitch said it thought Spanish banks would need €50bn to €60bn to deal with losses on domestic loan, under a so-called "base case".

That bill could surge to as much as €100m, however, if Spain was hit with an Irish-style housing crash and financial meltdown, Fitch said.

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