Spain Signed EFSF Rescue Pact on July 24, Economy Ministry Says

Spain signed a memorandum of understanding with the European Financial Stability Facility on July 24, a spokeswoman for the Spanish Economy Ministry said today, asking not to be named in line with government policy.

The agreement clears the way for Spain to receive a 30 billion-euro ($36.7 billion) first installment of the rescue package for its banking industry. The euro area has committed up to 100 billion euros for Spain to recapitalize its banks.

The capital needs of Spanish lenders have been estimated at 51 billion euros to 62 billion euros, according to a July 12 document on the EFSF’s website. The exact recapitalization needs should be determined by the end of September, according to the EFSF document.

To contact the reporters on this story: Rebecca Christie in Brussels at rchristie4@bloomberg.net; Angeline Benoit in Madrid at abenoit4@bloomberg.net.

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net