ML-Implode News - Spanish rescue draws closer as Cyprus buckles

Germany's Spiegel magazine reported that Chancellor Angela Merkel is actively pushing Spain into the arms of the EU bail-out machinery, concluding that Madrid cannot hope to tap the open market for the estimated â‚¬50bn to â‚¬90bn needed to recapitalise banks.
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Ms Merkel is herself under massive pressure from Europe's Latin bloc and world leaders. Leaks of a teleconference call on Wednesday reveal that France's FranÃ§ois Hollande, Italy's Mario Monti and US president Barack Obama launched a three-pronged attack, pressing Ms Merkel to drop Germany's veto on the use of EU rescue funds for banks.

The trio repeated their demands three times with mounting tension. Each time she answered no, first in English, and then in German for precision, according to details obtained by Italy's La Repubblica.
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Critics doubt whether a surgical bail-out of â‚¬50bn to â‚¬90bn is possible. Alberto Gallo from RBS said Spain will need â‚¬370bn to â‚¬450bn to tide it through to 2014, pushing its debt to 110pc of GDP.

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Spanish rescue draws closer as Cyprus buckles