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Spain to tap 60 bln euros bank aid,still plans to use only 40 bln

MADRID, Oct 25 (Reuters) - Spain will tap 60 billion euros from a European credit line agreed in June to recapitalise its troubled lenders, a draft amendment before Parliament showed, but the government still plans to use only 40 billion of that.

The document - an amendment to the draft financial sector reform law - is still in committee and has not gone to the floor for a vote. It was brought by the ruling People's Party, which has an absolute majority in the legislature.

The financial sector reform must be enacted before the end of November as part of the conditions for Spain to get aid for the banks.

A spokeswoman for the economy ministry said that the move was aimed at making sure the government had enough funds to prop up lenders but that it still estimates it will only use around 40 billion euros of the money.

An independent stress test of Spain's financial system published last month showed banks needed around 60 billion euros to resist a serious downturn of the economy.

But the figure is expected to come down after real estate assets are transferred into a so-called ``bad bank'', junior bondholders take a haircut on their holdings and some lenders manage to raise money on their own.

(Reporting by Blanca Rodriguez and Carlos Ruano; Writing by Julien Toyer; Editing by Fiona Ortiz)