An audit of Spain's banks showing how much they need to be recapitalized should be completed by Monday, two sources told Reuters on Thursday, with one saying the figure to clean up a number of banks will be 60 billion euros to 70 billion euros ($75 billion to $88 billion).
The audit from consulting firms Oliver Wyman and Roland Berger was due for completion by June 21, but will be moved forward because Prime Minister Mariano Rajoy wants it in hand when he attends a G-20 summit in Los Cabos, Mexico, early next week, the sources said.
The independent assessment was a key condition for the 100 billion euros ($125.7 billion) financial package agreed on Saturday to shore up troubled banks, which has so far failed to reassure investors about Spain's capacity to clean up the sector and keep its public finances under control.
"The government will have the headline figure from the auditors on the needs for the Spanish financial sector on Monday. The objective is to go the G-20 summit with this piece of information," said one of the sources.
The other source who gave the overall figure said it would include 19 billion euros ($23.9 billion) for Bankia and about 20 billion euros ($25.1 billion) for NovaGalicia (Banco NGC) and CatalunyaCaixa, all three banks already rescued by the Spanish government.
Wyman and Berger are carrying out the audit, which will recommend the amount needed to clean up Spanish banks that have large exposures to soured real estate assets, based on a scenario of a possible severe economic downturn.
Doubts about the mechanics and details of the bank bailout agreed last weekend, as well as the decision by Moody's to cut the country's credit rating to just one notch above "junk," have weighed on Spain's sovereign debt.
The Spanish government 10-year bond yield hit 7 percent for the first time in the euro era on Thursday, a level seen as unsustainable in the long term.
An earlier report by the International Monetary Fund said Spanish banks needed at least 40 billion euros in additional capital to weather a severe downturn with a spike in defaulted loans, but it also recommended a large cushion on top of that amount.
European leaders want the rescue deal wrapped up by their summit in Brussels on June 28-29. Before then, on Thursday, June 21, European finance ministers meet and the following day Rajoy will meet in Rome with the leaders of France, Germany and Italy.
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