Company: Banco Santander, S.A.

Spain's top five lenders will set aside an extra 15 billion euros ($19.4 billion) in provisions to cover risky property deals, heaping pressure on their finances as the country battles to restore confidence in its banking industry.

With its falling home prices and rising corporate and personal bankruptcies, Spain — whose economy is nearly five times larger than Greece — has now become the greatest threat to the global markets.

Spain's Santander reported on Tuesday 2011 net profit of 5.35 billion euros ($7 billion), down 35 percent after the group took extra provisions against toxic real estate assets in Spain.

Spain's second-biggest bank, BBVA, said on Tuesday it would take a hit of 1 billion euros ($1.3 billion)on its 2011 results due to an adjustment in goodwill for its U.S. unit.

Fitch Ratings downgraded on Tuesday its rating on Italy's biggest bank UniCredit and threatened rating cuts on seven other Italian banks and several Spanish and French banks following recent changes in its outlook on euro zone sovereign ratings.

China will probably stimulate its economy next year, shielding Latin American commodities producers from Europe's debt crisis by underpinning demand for raw materials, Nobel Prize-winning economist Joseph Stiglitz said.

A number of large institutional investors have threatened to stop buying bonds issued by Santander after Spain’s biggest bank offered to exchange some of its existing debt into new instruments at what they consider punitive terms, the Financial Times reports.