Moody’s announces €50 billion shortfall for Spanish banks (MarketWatch) (28-02-2011)

MADRID -- Moody's Investors Service on Monday announced that Spain's banks were possible to need up to €50 billion in recapitalization funds.- Higher than the government's own estimate that a maximum of €20 billion in recapitalization funds is needed and Moody's prior estimate of €17 billion that it calculated at end-2010.

Moody's stays cautious on the government's plan for recapitalization aimed at restoring market confidence while much of the recapitalization would be centred in the savings-bank sector.

The Bank of Spain, which has been working with the government to clean up the savings banks, will announce how much additional capital banks need on March 10 while according to Moody’s senior analyst, Spain will show confidence in banks only when the problematic exposures are translated into losses and the adequacy of bank capital is robustly tested.

Source: MarketWatch