A "troika" comprising the International Monetary Fund, European Central Bank and the European Banking Authority will monitor the multibillion-euro cash injection for Spanish banks, German Finance Minister Wolfgang Schaeuble said Monday.
AFP - Germany's finance minister on Monday stressed that billions of euros in aid to Spanish banks requested by Madrid would be overseen by European officials and the International Monetary Fund.
Asked whether Spain would avoid monitoring in the bailout, unlike previous deals with Portugal, Ireland and Greece, Wolfgang Schaeuble said: "No, there will be a troika in exactly the same way, that will of course monitor that the programme is being kept to."
"But this is only about a restructuring of the banking sector. That is the difference," added Schaeuble in an interview with German radio.
"While Portugal, Ireland and Greece are under macroeconomic adjustment programmes, it is important they are monitored ... Spain does not need that," he said.
"It's about Spanish banks, not about Spanish fiscal policy ... because on this point, Spain is on the right path," concluded Schaeuble.
"But the restructuring of the Spanish banking sector must be negotiated separately and it must be monitored to ensure that it is being kept to," he said.
On Saturday, Spain clinched a lifeline loan of up to 100 billion euros ($125 billion) for its crisis-wracked banks, sending stocks and the euro soaring at the open of trade on Monday before trader enthusiasm cooled as the day went on.
The eurogroup of finance ministers said after the meeting that "following the formal request, an assessment should be provided by the Commission, in liaison with the ECB, EBA and the IMF," referring to the European Central Bank and the European Banking Authority.
These authorities would also draw up "a proposal for the necessary policy conditionality for the financial sector that shall accompany the assistance," the statement said.
Madrid has flatly denied the aid amounts to a bailout, with Economy Minister Luis de Guindos telling reporters on Saturday that the loan did not amount to a rescue.
The government highlighted the fact that the deal imposed no new austerity measures or restrictions on the broader economy.
A spokesman for the German finance ministry, Martin Kotthaus, said later Monday that the funds were more likely to come from the European Stability Mechanism (ESM) bailout fund, due to come into force in July.
"We assume it is more realistic" that the ESM contributes the funds than its predecessor, the European Financial Stability Fund (EFSF), which has already stumped up for bailouts of Ireland, Portugal and Greece.
"The date (on which Madrid makes the formal request for aid) will be decisive in terms of which mechanism is used," added German government spokesman Steffen Seibert.
Date created : 2012-06-11