Bad loans as a proportion of total lending in Spain rose to a record in June as the country’s weak economy spurred a jump in missed payments.

Spain’s bailed-out Bankia has posted a full-year net loss of €19.2bn, the biggest ever suffered by a Spanish company, after the lender cleaned up its balance sheets of bad property loans and other risky investments.

La Liga’s winter transfer window shut more with a whimper than a bang last Thursday.

Santander plans to invest in Spain’s so-called “bad bank” in a sign that healthy domestic lenders are willing to support the entity created to clean up the aftermath of a 2008 property crash.

France and Germany clashed yesterday over the details of a banking union, with final agreement threatening to drag on until December, risking a return to volatility for the eurozone.

Spanish banks will need a total of €59.3bn in extra capital to ride out a serious economic downturn, an independent report said yesterday, removing a major obstacle in the way of an international bailout for Madrid.

As recession bites, enticing golf’s big names is a luxury Spain can no longer afford, says David Henry

The suggestion that Finance Minister Michael Noonan is considering using a 40-year bond to try to plug the promissory notes gap has been met with mixed responses from analysts.

Spain’s ailing banks are unlikely to need all of the €100bn which was made available by the country’s euro partners, Spanish economy minister Luis de Guindos said.

Spain overhauled its banks for the fifth time in three years yesterday in order to secure up to €100bn in European aid for lenders crushed by bad loans resulting from the country’s extended property market crash.

Spain is negotiating with the eurozone over conditions for international aid to bring down its borrowing costs, though the country has not made a final decision to request a bailout, three sources with knowledge of the matter said yesterday.

Spain is drawing up legislation that will allow the country’s central bank to intervene earlier when a lender falls into trouble as well as giving its bank rescue fund powers to shut them down if they fail to come up with survival plans, an Economy Ministry spokeswoman has said.

Only a few years ago, Spain’s banks were seen in some policymaking circles as a model for the rest of the world. This may be hard to fathom now, considering Spain is seeking €100bn to bail out its ailing lenders.

Spain’s experienced budget minister Christobal Montoro was the country’s first politician to admit that help was needed to bail out the banks and all eyes have now turned to what form that rescue will take, writes Kyran Fitzgerald

ENDA’S Dáil M for Merkel mystery continues to linger.

Bankia, the fourth largest bank in Spain, could get less than the €19 billion in aid it has asked for, two sources said, prolonging uncertainty surrounding a rescue that has added to fears that Spain itself would need a bailout.

German chancellor Angela Merkel has said she is open to establishing a European banking authority as a long-term solution to the continent’s financial crisis.

Germany does not expect Europe to take any final decisions on strengthening economic policy co-ordination between member states until the spring of next year, according to a government paper seen by Reuters.

Spain will stick to harsh austerity measures until it emerges from its financial crisis, Prime Minister Mariano Rajoy said today, promising that the country would survive the present economic turmoil.

Spain’s prime minister said today that his government is determined to stick to harsh austerity measures for as long as is necessary.

The Eurozone set-up is unsustainable, the head of the European Central Bank has told EU leaders today.

The eurozone should move to a banking union and consider directly recapitalising banks from its permanent bailout fund, the European Commission said in annual economic recommendations that shone a critical light on Spain.

The prospect of a multibillion-euro bailout for Spain increased today as the country’s borrowing costs edged up on fears over its beleaguered banking sector.

Spain, in a desperate bid to avoid a bailout, said it will raise money on the markets and use its own funds to fund banks and several of the semi-autonomous regions in the country.

Conservative Spanish prime minister Mariano Rajoy insisted yesterday that the country’s banking sector would not need an international rescue, as concern over the bailout of nationalised lender Bankia sent its stock price plummeting while Spain’s borrowing costs soared.

Conservative Spanish prime minister Mariano Rajoy insisted today that the country’s banking sector would not need an international rescue as concern over the bailout of nationalised lender Bankia sent its stock price plummeting while Spain’s borrowing costs soared.

Concern over the bailout plans for troubled Spanish lender Bankia and the country's ability to finance itself sent the nationalised bank's share price plummeting and Spain's borrowing costs soaring today.

The president of troubled Spanish lender Bankia has said the €23.5bn bailout it will receive from the state should be treated as an investment to make profit for the Spanish government, and not as a loan.

The president of troubled Bankia tried Saturday to calm fears about the future of the bank, saying Spain’s second largest mortgage lender will emerge as a solid financial entity after it receives €19bn in state aid in the country’s biggest ever bank bailout.c

The board of directors of the troubled Spanish bank, Bankia, says it has agreed to ask for €19bn in state funds.

The board of directors of the troubled Spanish bank, Bankia, says it has agreed to ask for €19 billion in state funds.

London’s leading index was broadly flat today as fears over Europe’s banks were offset by a strong consumer confidence survey on the other side of the Atlantic.

Spain’s market regulator has suspended trading of shares in bailed-out lender Bankia ahead of a board meeting of the bank that is expected to decide on the amount of money it needs from the government.

International institutions will oversee an audit of Spain’s banks aimed at reassuring investors that bailout costs will not spiral as the prospect of new Spanish borrowing threatens to further inflame the eurozone crisis.

Spain’s banks do not need to be bolstered with European money as suggested by France, the country’s economy minister said today.

Concerns that Europe's debt crisis could drag down parts of the continent's banking system hit most global markets today, though social network Facebook's imminent flotation buoyed sentiment on Wall Street.

Britain’s biggest banks saw shares slide today as fears over the eurozone debt crisis were compounded by a far-reaching debt downgrade of Spanish banks.

Spanish stocks have dropped sharply after ratings agency Moody’s downgraded its credit score of 16 Spanish banks in the latest blow to the troubled financial sector.

Moody’s Investors Service cut the long-term debt and deposit ratings of 16 Spanish banks yesterdays, including Banco Santander, the eurozone’s largest, saying the government’s ability to support some banks had weakened.

The euro slipped along with world stocks yesterday as deepening turmoil in Greece and Spain kept investors wary of riskier assets, with weak US economic data adding to the cautious mood.

Spain has paid sharply higher interest rates to raise €2.5bn in a medium-term debt auction, reflecting fears it will be caught up in the fallout of the Greek crisis.

Banco Santander SA and Banco Bilbao Vizcaya Argentaria will set aside €4.5bn to meet a Spanish government order to boost real estate provisions as analysts speculate the industry may need more.

Spain will force banks to increase provisions against real estate loans by about €30bn and will hire two auditors to value lenders’ assets in a fourth attempt to clean up the industry.

Hoping to put an end to a four-year banking crisis, the Spanish government effectively took over Bankia SA, one of the country’s biggest banks, after days of market anxiety over its viability.