Santander’s need for fresh capital has been apparent for weeks. But until recently senior executives at Spain’s biggest bank were confident that they could recapitalise at leisure over the course of 2009 and without recourse to market-shaking announcements.

That all changed before European markets opened on Monday when Santander unveiled an unexpected and deeply discounted €7.2bn ($9.2bn) rights issue designed to boost its core capital ratio to 7 per cent of assets from 6.31 per cent in the third quarter.