Spain to ask for aid as EU fights debt crisis

A few days ago Spain was purportedly going to need another €30 billion to €70 billion to recapitalize Spanish banks. I suggested the amount would be at least triple that and it did not take long to do so. Yahoo! Finance reports Spanish bailout could reach 100 billion euros A bailout for Spain's teetering banks, once requested by Madrid, could amount to as much as 100 billion euros, two senior EU sources told Reuters on Saturday.

Spain made a formal request on Monday asking fellow Eurozone countries to help with its crumbling banks -- a financial aid package that could be worth up to 100 billion euros, or about $125 billion.

By Marc Chandler:Investors ought not let recovery in the global capital markets in response to the broad brush strokes of an aid package for Madrid obscure the fact that the underlying quagmire just got deeper. The favorable market response is largely technical in nature and related to extreme positioning and the out-sized moves in May.

Official Denials From Finance Minister Finance Minister Says "Nothing to Hide" Asks for ECB Audit of Banks, Denies Need for Rescue Fund

Reports say financial institutions need between €60– and €100-billion to recapitalize

By Marc Chandler:Greece has been the model for Portuguese and Irish aid. This may or may not have been fair and appropriate. After all, the nature of the Portuguese and Irish problems were dissimilar from Greece and each other. Spain's is more like Ireland's. The key differences include Spain's size, officials have progressed on a learning curve, and the now perceived greater vulnerability of the whole EMU project.

MADRID (Reuters) - Spain's debt will reach 90.5 percent of gross domestic product by end 2013 after hitting 85.3 percent of GDP by the end of this year, the government's budget document showed on Saturday. The debt ratio included 30 billion euros of the planned 100-billion-euro aid request for the country's banks, the document said. The Treasury saw gross debt issuance requirements of 207.2 billion euros next year after budgeting in 2012 for gross issuance of 186.1 billion euros. ...