Catalonia is the region that was first to announce plans to tap the Spanish government's 18 billion euro bailout fund as the region has been locked out of debt markets. Earlier today, the Spanish government announced that it had obtained 3 billion euros through a private placement with Spanish banks to fund that bailout package. The big Spanish banks, Santander, BBVA and La Caixa will contribute most of the funding.
The reason for the problems have to do with Catalonia's large funding needs. It has by far the largest debt load, with its 41 billion euros of debt coming in at twice the size of the next largest regional debtor Valencia. And its funding needs are also the largest, with nearly 5 billion euros of external funding needed in the 4th quarter alone due to deficit overruns. Cataloni...
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Edward Harrison is the founder of Credit Writedowns and a former career diplomat, investment banker and technology executive with over twenty five years of business experience. He has also been a regular economic and financial commentator in print and on television for the past decade. He speaks six languages and reads another five, skills he uses to provide a more global perspective. Edward holds an MBA in Finance from Columbia University and a BA in Economics from Dartmouth College.