Stress tests on Spain's banks show they need between €16 billion and €62 billion in extra capital to help them weather the financial crisis.
The amounts were announced at a news conference by Bank of Spain deputy governor Fernando Restoy.
They were well below the €100 billion in emergency credit that euro zone partners have offered for Spain's banks
The estimates, the result of tests by US audit firm Oliver Wyman and German firm Roland Berger, will determine how much of that credit Spain formally requests.
Oliver Wyman estimated the banks had capital requirements in a range of €16-25 billion in a basic stress test, while in a tougher worst-case scenario this rose to between €51-62 billion.
Roland Berger calculated the capital needs in a standard test at €25.6 billion.
This rose to €51.8 billion in the worst-case scenario, which factors in an extreme recession and fall in house prices.
Roland Berger also saw a near 20% fall in house prices in Spain this year - in a worst case scenario - while it said that land prices could tumble as much as 50%.
Its ''adverse'' scenario also said that the Spanish stock exchange could lost over 51% of its value this year while it could fall another 5% next year.
The stress tests focussed on 14 Spanish banks that account for 90% of the country's financial sector, covering the entirety of their loans to consumers and businesses.
The audit did not break down the capital needs of individual banks, but the evidence indicated that the extra money would be concentrated in banks already being helped by the state-backed bank restructuring fund, he said.
"The largest entities in the country do not need need additional capital," said Restoy.
A second, more detailed study to be carried out by Deloitte, KPMG, PwC and Ernst & Young, is to look at the valuation of banking assets, with a global figure due July 31 and a breakdown in September.
Spanish Finance Minister Luis de Guindos said at a meeting with his euro zone counterparts in Luxembourg today that Spain would make its formal request for a loan under the credit deal "in the coming days".
Spain's banks are staggering under a mountain of bad loans made during the country's construction bubble which burst in 2008. Spain's borrowing costs have shot up on financial markets in the past week, raising fears that it may need a full sovereign bailout.
Spanish borrowing costs continue to push higher
Spain's borrowing costs soared in a major market test today. But the country showed it can still tap the bond market at a pivotal time, with a euro zone rescue loan of up to €100 billion in the works and fears mounting that a state bailout could follow.
The Treasury raised €2.22 billion, beating its own target, and demand outstripped supply by more than three times for the mixture of two, three and five-year bonds, Bank of Spain figures showed. But it had to pay soaring rates to lure investors.
The yield more than doubled to 4.706% from 2.069% at the last comparable sale March 1 for two-year bonds, a sign of deep misgiving about Spain's near-term prospects. The rate on three-year bonds climbed to 5.457% from 4.876% on May 17; while for five-year bonds it leapt to 6.072% from 4.960% on May 3.
Spain's euro zone partners agreed on June 9 to lend up to €100 billion to save stricken banks that made reckless loans during a property bubble that imploded in 2008.
Far from calming markets, the banking rescue pushed Spain's borrowing rates to the highest levels since the birth of the euro in 1999 as investors fretted over the impact of the loan on Spain's booming debt. The banking bailout further undermined confidence because it lacked details such as the price and conditions while highlighting Spain's difficulties in raising money on the markets.
Yields eased this week after a Group of 20 summit in Los Cabos, Mexico, raised expectations that European Union authorities could step in to help Spain and Italy, possibly by purchasing their bonds.
France raises €10 billion at record low rates
France raised €9.87 billion today in an issue of medium and long-term term bonds at record low rates with strong demand from investors, the French state debt agency said.
The yield on two-year bonds fell to a record low since the creation of the euro to 0.54%, from 0.74% in the previous auction on May 16. On five-year bonds the rate of return to investors fell to a record low of 1.43%, from 1.72% on May 16.
France also issued long-term inflation-indexed bonds, with the rate of return for investors on bonds due in July 2023 at 0.91% plus the rate of French inflation, down from 1.19% before inflation in the last auction on May 16.
