By Jesús Aguado
MADRID (Reuters) - Spanish companies and households have taken up nearly all of the first 20 billion euro (17.54 billion pounds) tranche of state-backed credit aimed at alleviating the economic fallout from the coronavirus pandemic, bankers said on Monday.
The funds are part of the 100 billion euros of state guarantees the Spanish government approved in March to mitigate the impact from the virus outbreak..
Four banking sources said the initial funds could be used up very shortly and some said banks were already asking for the next tranche.
"Over the next days this funding scheme will be totally disbursed," one banking source familiar with the matter said.
Another banker from a retail department said the funding scheme - which started to formally register credit applications on Monday after applications have been coming in for the past two weeks - could run out of money by the end of the day.
The government has said it will closely follow the process before deciding to disburse any further funds from the scheme and that the Bank of Spain is making sure lenders are meeting the conditions set in the programme.
The guarantees cover new lending for up to five years, but not restructured loans, and banks are not entitled to sell other commercial products, like insurances or credit cards, or engage in aggressive commercial practices involving the funding.
The credit lines were assigned to banks according to the market share each has in loans to small and medium-sized businesses (SMEs), self-employed workers and bigger corporates.
Some banks like Santander (MC:SAN) initially wanted a bigger share of the scheme and had pushed for demand to be the key factor in distributing funds, the bankers said.
The lender, which on average has a 20% market share in loans to these segments, can take up 4 billion euros of the initial tranche, they said. Santander declined to comment.
BBVA (MC:BBVA) can apply for between 15% and 20% of the scheme, or 3 billion to 4 billion euros, the bankers said.
Caixabank (MC:CABK) can be granted around 3 billion euros, while Sabadell (MC:SABE) can take up 2.2 billion euros and Bankia (MC:BKIA) 1.5 billion euros, they added.
A source familiar with the matter at Bankinter (MC:BKT), which is entitled to 1 billion euros of the funding scheme, said that as of Friday it had received credit applications from SMEs worth up to 1.7 billion euros.
Spain is guaranteeing up to 80% of the loans for small companies with fewer than 250 employees, and up to 70% for larger companies.
The government will charge banks between 20 basis points and 120 basis points for guaranteeing loans and lenders are not allowed to pass on the costs of these credit lines to clients.