EC urges quick Bankia rescue plan to end uncertainties Spain should carry out the refinancing of its banking sector, laid low by a decade of unsustainable lending during a property boom, by market mechanisms or government funds, rather than a European rescue which would have negative connotations, Mr Altafaj said. "The sooner uncertainties are removed the better," he added. The European Commission offered direct aid from a eurozone rescue fund to recapitalise distressed banks on Wednesday and proposed giving Spain more time to reduce its budget deficit. However, permitting the European Stability Mechanism (ESM) to lend directly to banks would require a change to a treaty in the midst of ratification by member states that might come too late for Spain. Madrid said its state-backed bank rescue fund would issue bonds to inject funds into Bankia, but senior debt bankers said the syndicated bond market is closed to the rescue fund because investors are too nervous to take on Spanish risk. Spain's Deputy Prime Minister Soraya Saenz de Santamaria is due to meet US Treasury Secretary Timothy Geithner and International Monetary Fund Director General Christine Lagarde in Washington on Thursday. The deputy PM will outline Spain's measures to tackle its crisis during the meetings, which were convened before Spain's situation reached boiling point, a government spokesman said.