Eurogroup statement on Spain

9 June 2012 
Eurogroup statement on Spain 
The Eurogroup supports the efforts of the Spanish authorities to resolutely 
address the restructuring of its financial sector and it welcomes their intention 
to seek financial assistance from euro area Member States to this effect. 
The Eurogroup has been informed that the Spanish authorities will present a 
formal request shortly and is willing to respond favourably to such a request. 
The financial assistance would be provided by the EFSF/ESM for 
recapitalisation of financial institutions. The loan will be scaled to provide an 
effective backstop covering for all possible capital requirements estimated by 
the diagnostic exercise which the Spanish authorities have commissioned to 
the external evaluators and the international auditors. The loan amount must 
cover estimated capital requirements with an additional safety margin, 
estimated as summing up to EUR 100 billion in total.  
Following the formal request, an assessment should  be provided by the 
Commission, in liaison with the ECB, EBA and the IMF, as well as a proposal for 
the necessary policy conditionality for the financial sector that shall 
accompany the assistance.  
The Eurogroup considers that the Fund for Orderly Bank Restructuring 
(F.R.O.B.), acting as agent of the Spanish government, could receive the 
funds and channel them to the financial institutions concerned. The Spanish 
government will retain the full responsibility of the financial assistance and will 
sign the MoU. 
The Eurogroup notes that Spain has already implemented significant fiscal 
and labour market reforms and measures to strengthen the capital base of 
the Spanish banks. The Eurogroup is confident that  Spain will honour its 
commitments under the excessive deficit procedure and with regard to 
structural reforms, with a view to correcting macroeconomic imbalances in 
the framework of the European semester. Progress in these areas will be 
closely and regularly reviewed also in parallel with the financial assistance. 
Beyond the determined implementation of these commitments, the 
Eurogroup considers that the policy conditionality of the financial assistance 
should be focused on specific reforms targeting the financial sector, including