Spain Banks at Risk From Unemployment, Regulator Says (Update1) - BusinessWeek

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Spain Banks at Risk From Unemployment, Regulator Says (Update1) - BusinessWeek: "Spain’s “mass unemployment” is the greatest risk facing the country’s banking system, which could become a drag on the economy rather than a support for it, Central Bank Governor Miguel Angel Fernandez Ordonez said.
“If Spain maintains for a prolonged period these millions of workers out of jobs, the banking system could become an obstacle to achieving economic recovery after being a support for the economy during the crisis,” Ordonez said in a speech today in Madrid.
Spain’s unemployment rate is the highest in the euro area at 19 percent in February, and the country accounts for half the region’s job losses over the last two years, according to the European Union’s statistics office. Unless the country comes up with changes to its labor market to address the “very Spanish” problem of high unemployment, banks will suffer the consequences in terms of higher defaults, less business and a higher cost of financing, Ordonez said."