Spain to use stress tests on banks

<p>Spain is set to use stress tests on its beleaguered banking sector.</p>

Spain is due to unveil its banking sector's shortfall with stress tests, which are set to show just how much money the industry will need in order to avoid a full-blown bailout from international lenders.

The stress tests will demonstrate how much in toxic property is held by 14 of its financial institutions.

Prime minister Mariano Rajoy and his government are still hopeful they can avoid a formal bailout from eurozone rescue funds, but many believe such a rescue package is an inevitability for the troubled Iberian nation.

In July, the country requested a soft loan of up to €100 billion (£80 billion) just for its banking sector and yesterday (September 27th), it set out its austerity budget, which is spending-cut heavy and has sparked violent civil protests in Madrid.

At 10:50 BST, the euro was 0.2 per cent stronger in forex trading with the dollar, rising to €1 for every $1.294 and it made 0.3 per cent gains against the pound to £0.797.

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