PARIS. May 19. KAZINFORM It has got harder for Spain to pay its way following Thursday's double whammy of bad news in the financial sector.

Sixteen banks have been downgraded by Moody's agency, including the eurozone's biggest, Santander.

That added to the gloom from Spain's fourth largest lender Bankia, whose share price collapsed in the midst of reports of huge withdrawals, the euronews reports.

Three or four-year government bonds are now only selling with a five percent-plus interest rate which is raising the spectre of international financing drying up.

"Italian banks' positions have worsened. Now Spanish banks are finding they have a lot of underperforming or seriously devalued assets, and are trying to restore calm. The markets are also reacting to signs of an orderly withdrawal from the euro by Greece," said François Chaulet, Asset Manager at Montsegur Finance.

With 10-year Spanish bonds now close to the seven percent yield level that triggered EU bailouts for Greece, Ireland and Portugal, time may be running out for Spain.

Read more http://www.euronews.com/news/