Germany confirms 'troika' to monitor Spanish aid

Germany's finance minister on Monday stressed that billions of euros in aid to Spanish banks requested by Madrid would be overseen by European officials and the International Monetary Fund. Asked whether Spain would avoid monitoring in the bailout, unlike previous deals with Portugal, Ireland and Greece, Wolfgang Schaeuble said: "No, there will be a troika in exactly the same way, that will of course monitor that the programme is being kept to." "But this is only about a restructuring of the banking sector. That is the difference," added Schaeuble in an interview with German radio. "While Portugal, Ireland and Greece are under macroeconomic adjustment programmes, it is important they are monitored ... Spain does not need that," he said. "It's about Spanish banks, not about Spanish fiscal policy ... because on this point, Spain is on the right path," concluded Schaeuble. "But the restructuring of the Spanish banking sector must be negotiated separately and it must be monitored to ensure that it is being kept to," he said. Spain on Saturday clinched a lifeline loan of up to 100 billion euros ($125 billion) for its crisis-wracked banks, sending stocks and the euro soaring at open though trader enthusiasm cooled as the day went on. The eurogroup of finance ministers after the meeting said that "following the formal request, an assessment should be provided by the Commission, in liaison with the ECB, EBA and the IMF," referring to the European Central Bank and the European Banking Authority. These authorities would also draw up "a proposal for the necessary policy conditionality for the financial sector that shall accompany the assistance," the statement said. Madrid has flatly denied the aid amounts to a bailout, with Economy Minister Luis de Guindos telling reporters on Saturday that the loan did not amount to a rescue. The government highlighted the fact that the deal imposed no new austerity measures or restrictions on the broader economy.