Portugal and Spain are not expected to ask for bailout, says Regling

KLAUS REGLING, the chief executive of the European Financial Stability Facility (EFSF), has said he does not expect Portugal or Spain to ask for bailouts, Austrian state radio ORF has reported.

“At the moment it looks like Ireland will be the only country to have tapped the EFSF,” Mr Regling said.

“I don’t see any need at all any more for Spain” to take money, he said, adding that “Portugal still has to do some work”.

While the EFSF would have sufficient funds for additional bailouts, giving funds “currently doesn’t look necessary”, he said.

“The markets are speculating that a country like Portugal may need help. Other countries that a few weeks and months ago also were thought by the financial markets to require help, today are in a different state of development,” he added.

In Spain “extensive additional budgetary consolidation and structural reform measures” have led markets to accept that “Spain doesn’t need any money,” he said.

Last year Mr Regling co-authored with Max Watson a report into the banking crisis in Ireland for the government.

They said the crisis resulted from a “plain vanilla property bubble” and “weak” bank governance and risk management. They were critical of the Government’s management of the economy.

Mr Regling has been CEO of the EFSF in Luxembourg since July 2010, having previously worked for the International Monetary Fund and the German ministry of finance. – (Bloomberg)