Spanish bank bailout might cost 80 billion euros - IMF

Spanish banks, reeling from bad home loans and a horrible economy, will almost certainly have to be bailed out by the EU to the tune of $40 billion. That's the estimate from the IMF. But will Spain bend the knee and beg the EU for the cash? Reuters: The IMF said its "stress test" does not include extra capital that it recommends Spain needs as a buffer to cover restructuring costs and loan losses. An IMF official said such a buffer usually would be 1.5 to two times larger to convince markets that Spain has a credible cushion to handle shocks. In Spain's case, that would bring the size of capital required to stabilize its banking system to as much as 80 billion euros, although the IMF did not specify a figure in its Financial Sector Assessment Program report released on Friday. Spain is expected to ask the euro zone for help with recapitalizing its banks this weekend, sources in Brussels and Berlin told Reuters on Friday, becoming the fourth country to seek assistance...(Read Full Post)