Bank of Spain approves funding plans for troubled lenders
Government admits claim Chinese fund was ready to invest in beleaguered cajas was wrong
The Bank of Spain announced on Thursday that it had approved the capital-raising plans presented by 13 banks and savings banks, known as cajas, including a 2.8-billion-euro application for state funding from the troubled Caja Mediterraneo (CAM). In a statement, the central bank said that nine financial entities may need to tap into money from the FROB bank restructuring fund. Four have agreed to seek private investors to raise up to 20 percent of the capital, the statement said.
Meanwhile, the government admitted Thursday that it had made an error in announcing the day before that China's sovereign fund China Investment Corporation (CIC) would inject aboutnine billion euros into Spain's beleaguered cajas. The government said that it had "made a mistake in identifying" the fund and the amount.
Prime Minister Zapatero has spent this week on an official visit to China.
