Originally posted by the Voice of America.
Voice of America content is produced by the Voice of America,
a United States federal government-sponsored entity, and is in
the public domain.


             Spain, Cyprus Looking for Outside Aid for Ailing Banks

   Spain, one of the euro currency bloc's biggest economies, formally
   sought a bailout for its financially troubled banking system Monday.
   Meanwhile, Cyprus - one of the eurozone's smallest countries - is also
   looking for help for its distressed banks.
   The twin bids in Madrid and Nicosia for outside assistance for their
   ailing banks kicked off a week of uncertainty in the 17-nation currency
   union as the continent's leaders head to a European Union summit in
   Brussels on Thursday and Friday.
   Spain asked for up to $125 billion rescue for banks left holding bad
   real estate loans. But Spanish Foreign Minister Jose Manuel Margallo
   said details of the bailout would be determined later, including
   whether the loans would have to be paid by the Spanish government, or
   the banks alone.
   "About the issue of finance help for bank recapitalization, today it's
   just a formal procedure," he said. "The important thing is the
   negotiation of the contract terms, the repayment period, the longer the
   better, and interest rates, the lower the better. The question about if
   help should go directly to the banks or to the state is still open."
   One financial analyst, Robert Halver of the Baader Bank, said eurozone
   officials need to act decisively resolve the governmental debt crisis,
   now in its third year.
   "The summit next weekend has to to bring clear results," he said. "We
   have always said that, but now it really is 5 [minutes] to 12. We now
   need a master plan which steps have to be taken to tackle the problems.
   We not only need stronger [European] integration but it must be clear,
   the German position must be to let the ECB [European Central Bank] help
   with the rescue [of the euro]. The bailout fund cannot do this alone."
   Meanwhile, the Fitch financial services company became third such firm
   to downgrade the credit standing of the island nation of Cyprus to
   "junk" status.  An EU diplomat said Cyprus would first seek more than a
   $6 billion loan from Russia to help its banks, and then more aid from
   the eurozone.
   Cypriot banks are heavily exposed to troubled purchases of government
   debt from nearby Greece.
     __________________________________________________________________

   [1]http://www.voanews.com/content/spain-cyprus-looking-for-outside-aid-
   for-ailing-banks/1248730.html

References

   1. http://www.voanews.com/content/spain-cyprus-looking-for-outside-aid-for-ailing-banks/1248730.html