Spain Creates 9 Billion Euro Fund for Bank Recovery

The Spanish government has proposed setting up a fund of nine billion euro to support restructuring of banks and hope the measure will be approved by the country’s Congress, says economy minister Elena Salgado.

The fund will be administered by the Bank of Spain. Prime Minister José Luis Rodríguez Zapatero said that some savings banks in Spain have difficulties because of the crisis in the real estate sector, and showed that the government will support in the next two, three years.

The Bank of Spain will use the fund to buy shares of savings in banks, if attempts at a merger or restructuring of those will fail.

Number of companies and individuals in Spain came in unable to pay has tripled in the first three months of the year, compared to the same period a year earlier, according to consulting company PricewaterhouseCoopers, quoted by Reuters.