The European Central Bank has in effect funded new lending in Spain in recent months, replacing banks' use of wholesale capital markets, which have been strangled by the global credit crunch.

Spanish banks doubled their share of the ECB's weekly funding auctions in the final quarter of last year, taking their borrowing up to €44bn ($64bn) in December from a running average of about €20bn over the previous 15 months, according to the most recent data from the Bank of Spain.