( CNN ) -- Spain is to be offered an initial 30 billion euros ( US $ 36.9 billion ) to bail out its troubled banks following an emergency meeting of Eurozone finance ministers . The agreement followed nine hours of talks in Brussels that concluded early Tuesday . It was aimed at preventing Spain , the eurozone 's fourth largest economy , from needing a full bailout itself . In June , European finance ministers agreed to set aside $ 150 billion to shore up the capital base of Spain 's banks . Madrid was also given an extra year to meet its steep budget deficit target , according to Jean Claude Juncker , Luxembourg 's prime minister and the head of the Eurozone finance ministers group . Spain had been told to cut the difference between its income and spending to within 5.3 % of gross domestic product ( GDP ) by the end of 2012 . But it will now be given until 2014 instead of 2013 to cut its deficit to below 3 % of GDP . Spain given extra time to cut deficit . `` We are aiming at reaching a formal agreement in the second half of July , taking into account national parliamentary procedure , allowing for a first disbursement of 30 billion euros by the end of the month to be mobilized as a contingency in case of urgent needs in the Spanish banking system , '' Juncker said in a statement to reporters after the meeting . The ministers from the 17-nation bloc met 10 days after their heads of government agreed to use its temporary bailout funds to recapitalize Spain 's ailing financial system and to set up a joint supervisory body for the area 's lenders . Under the terms of the deal , this supervisory body will oversee the eurozone 's banks and use the single currency area 's rescue funds , the European Financial Stability Facility or European Stability Mechanism , to aid banks directly without adding to governments ' debt . However , the first cash injection will be filtered through Madrid 's existing bailout fund . Audits commissioned by the Spanish government recently showed its banking sector -- beset by bad debt in the aftermath of the country 's property market crash -- is likely to need 60 billion to 70 billion euros in extra cash to stay solvent . Meanwhile , Spanish and Italian borrowing costs continued to rise to unsustainable levels Monday , with Spain 's 10-year bond topping the critical 7 % level . CNN 's Nina Dos Santos contributed to this report .
Euro ministers agree 30 billion euro ( US $ 36.9 billion ) bailout package for Spain 's banks . Aimed at preventing Spain , eurozone 's fourth largest economy , from needing bailout itself . Madrid was also given an extra year to meet its steep budget deficit target . Spain 's banks suffering with bad debts mainly due to nation 's property market crash .