MADRID (Reuters) - A final agreement for European aid of up to 100 billion euros ($126.06 billion) for Spanish banks may be delayed by a few days, until July 20, to allow more time for negotiations, two sources close to the talks said on Tuesday.
The signature of the Memorandum of Understanding (MoU) was initially scheduled for July 9, when euro zone finance ministers hold their monthly meeting in Brussels.
“The document will be looked at on Monday. We will try to close a deal but it may well take a few more days,” said one of the sources, confirming that a new meeting of the Eurogroup had been penciled in on July 20.
The MoU is due to specify the maturity and the interest rate of the loans - probably over 15 years and between 3 and 4 percent respectively, according to government sources - as well as the conditions attached to them such as a restructuring of the entire sector and a reform of banking supervision.
The source also said the first tranche of European money would be sent to Spain’s bank restructuring fund FROB on time for the state-rescued banks Bankia, CatalunyaCaixa, NovaGalicia and Banco de Valencia to keep running their day-to-day operations normally.
Economy Minister Luis de Guindos said earlier on Tuesday that the European lifeline should be made available to the banks within weeks, while Secretary of State for Economy Fernando Jimenez Latorre had raised last week the possibility of using “transitory liquidity mechanisms”, without providing any detail.
Reporting by Julien Toyer in Madrid and John O'Donnell in Brussels; editing by Ron Askew