Micheál Martin (Cork South Central, Fianna Fail)
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Question 60: To ask the Minister for Finance his views on whether there is a belief amongst EU leaders that Spain may need an equity injection; and if he will make a statement on the matter. [30399/12]

Michael Noonan (Limerick City, Fine Gael)
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As the Deputy will be aware, agreement has been reached to provide loans of up to €100 billion for the recapitalisation of Spanish banks. Loans have not been requested to finance the Spanish sovereign. The financial assistance is to be provided by the EFSF until the ESM becomes available, at which stage it will be transferred to the ESM.

The Deputy will also be aware that Heads of State or Government of the euro area have decided that once an effective supervisory mechanism is established, the ESM could have the possibility to recapitalise euro area banks directly. This is a very positive development from an Irish perspective.

A 'top-down' exercise by external evaluators has estimated the capital needs for the Spanish banking sector as a whole to be in the region €51-62 billion. However, the exact amount will be determined based on a thorough bottom-up assessment of individual financial institutions which has already been launched. More detailed work between the Spanish authorities and the Troika is continuing and it is anticipated that further progress will be made during this month.