The EC released $48 billion from its European Stability Mechanism (ESM) for four Spanish banks. The funds are contingent upon restructuring by the banks. That will included layoffs, and office closings. The money is part of a 100 billion euro request that was made earlier. The government is looking at the possibility of creating a "bad bank" that would receive the non-performing loans from Spanish banks.
The three largest banks in Spain were given a clean bill of health, but the real estate loans made during the real estate boom in Spain has contributed to its weak recovery from recession. Credit has become scarce as banks attempt to shore up their balance sheets.