European Central Bank President, Mario Draghi

BBC

Spain's economy minister has dampened speculation that the country is about to seek a bailout of its bank sector.

Luis de Guindos said no decision would be made until audits of the banks were completed, possibly by the end of June, reports the BBC.

There have been reports in the past few days that Spain was seeking an immediate bailout from eurozone funds.

de Guindos was speaking in Brussels, where plans have been published that aim to ensure that taxpayers do not have to fund future bailouts of banks.

An IMF audit of Spain's banks is due next week, with further independent reports completed about two weeks after, de Guindos said.

"I have absolutely not discussed any intervention in Spain's banks today," de Guindos told reporters on the sidelines of meetings in Brussels.

Asked if Spain was preparing a request for EU aid, he said: "We are not preparing anything... we have a road map."

With investors demanding higher returns to lend money to Spain, its finance minister said the credit markets were "effectively shut" to his country, inflaming worries that the country would be forced to join Greece, Portugal and Ireland and seek outside help.

Spain has to find at least 80bn euros ($100bn; £65bn) to strengthen its banks' capital buffers.

A key test will come on Thursday, with Spain due to auction up to 2bn euros of bonds.

Spain is keen to avoid having to ask for a European Union bailout as this would come with strict conditions.

It is instead seeking funds which could be injected directly into the banking system.

Reports suggesting EU officials are looking at how this could happen contributed to a rally on European markets late in the afternoon.

UK Prime Minister David Cameron and US President Barack Obama kept up pressure on European leaders, calling for an "immediate plan" to restore confidence, after the two men spoken on the telephone last night.

The prime minister is due to meet German Chancellor Angela Merkel on Thursday to discuss the issues.

The European Central Bank appeared unlikely to take any immediate action to provide further financial support, despite President Mario Draghi acknowledging the seriousness of the eurozone's crisis.

After the ECB left interest rates unchanged at 1% on Wednesday, Draghi suggested that further monetary policy was not the answer.