Europe bailout of Spain could cost $125 billion

The Associated Press

AP Photo/Andres Kudacki
Spain's Economy Minister Luis de Guindos gestures during a news conference at the Ministry of Economy and Competitiveness in Madrid, Spain, Saturday, June 9, 2012. Spain will ask for a bailout for banks felled by bad real estate loans, in an about-face that European officials welcomed Saturday and said could cost up to EUROS100 billion ($125 billlion). A rescue for Spain will be Europe's fourth since the single currency bloc's debt crisis erupted two years ago

MADRID (AP) — Spain became the fourth and largest country Saturday to ask Europe to rescue its failing banks, a bailout of up to €100 billion ($125 billion) that leaders hoped would stabilize a financial crisis that threatens to break apart the 17-country eurozone.

The rescue offer follows growing pressure from international investors and the Obama administration and comes a week before elections in Greece, whose voters could decide whether the country leaves the euro.

Europe's widening recession and financial crisis has hurt companies and investors around the world. Providing a financial lifeline to Spanish banks is likely to relieve anxiety on the Spanish economy — which is five times larger than Greece's — and on markets concerned about the country's ability to pay its way.

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June 09, 2012

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Friday, May 24, 2013 Last Update: 3:01 AM ET