BRUSSELS, June 25 (Xinhua) -- European Commission Vice President Oli Rehn on Monday welcomed Spain's decision to formally request financial assistance for its troubled banking sector, and pledged to speed up work on the side the European Commission.
"I have instructed our staff to step up their work to provide a clear assessment of the sector and its needs, as well as a proposal for the necessary policy conditionality that shall accompany the assistance, in liaison with the staff of the ECB, EBA and the IMF," Rehn said in a statement.
He confirmed that the capital requirements recently calculated by two private firms had provided a good starting point for this work.
Madrid said on Thursday that its banks would need up to 62 billion euros (about 78 billion U.S. dollars) to weather a severe financial slump, far less than the maximum 100 billion euros that has been offered by the Eurogroup.
Rehn expressed confidence that both sides might conclude an agreement on the Memorandum of Understanding in a matter of weeks, "so that we can proceed with the restructuring effort," he said.
"Restructuring the banking sector is key to reinforce the confidence in the Spanish economy and to restore the conditions to proper access to credit by companies and households, thus for sustaining the recovery." Rehn stated.
But he reiterated that policy conditionality of the financial assistance, in the form of an EFSF/ESM loan, would be focused on specific reforms targeting the financial sector, including restructuring plans which must fully comply with EU state-aid rules.
What is more, the conditionality would also apply to banks being recapitalised and to the Spanish financial sector as a whole, including its supervision and regulatory requirements, according to Rehn.