Banks' problems "light years away" from Ireland's, says minister

Following on the government's announcement of pay cuts of up to 80 percent for executives at savings banks that benefited from public money, Economy Minister Luis de Guindos said that the goal is "to get banking out of the front lines of Spain's problems."

 In an extensive interview with EL PAÍS, De Guindos said that "the financial sector is essential to the Spanish economy, and there are entities that were not fulfilling their basic role: granting credit.

"With this restructuring, Spain's problem will not be banking, it will be recession and unemployment," he said.

The economy chief - who worked for Lehman Brothers before joining the Popular Party administration - rejected comparisons with Ireland.

"The problems of Ireland's financial system have absolutely nothing to do with Spain's," he said. "The cost of reform in Ireland was tens of points of their GDP. Even if you accept the most rabid analyst's figures, Spain is still light years away from that."

De Guindos has also asked banks to provision 50 billion euros more to cover sketchy real estate assets.