Eurozone Finance Ministers To Meet Ahead Of Key Summit

The credit ratings of 28 Spanish banks were downgraded after Spain formally requested a bailout for its banks.

The finance ministers of the eurozone's four biggest economies -- Germany, France, Italy, and Spain -- are expected to hold talks in Paris on June 26, ahead of this week's European Union summit.

Leaders at the June 28-29 summit are expected to discuss measures to resolve the worsening eurozone debt crisis.

Reports say it will be the 20th time EU leaders have met to try to resolve the crisis that has spread across Europe since it began in Greece in early 2010.

The euro lost value against the dollar on financial markets on June 26, amid investor doubts that any substantial decisions will be made at the summit.

In the latest crisis developments, an international ratings agency has downgraded the credit ratings of 28 Spanish banks after Spain formally requested a bailout for its banks on June 25.

Also on June 25, Cyprus announced it was seeking financial assistance for its banks, which are heavily exposed to the debt-burdened Greek economy.

Cyprus would be the fifth eurozone country -- after Greece, Ireland, Portugal, and Spain -- to ask for emergency funding from its eurozone partners.

The island's government did not specify a figure for its request. Cypriot media reports, however, said Cyprus may need a bailout of up to 10 billion euros ($12.5 billion) -- or over half the size of its economy.

The bailout request comes as Cyprus prepares to assume the rotating EU presidency on July 1.

The eurozone has already pledged up to 100 billion euros in financial assistance to Spain's banks, which have been hit hard by a crash in the country's real estate sector.

Spanish Prime Minister Mariano Rajoy said EU leaders must dispel doubts about the future of the euro.

The common currency and European shares were down on financial markets amid low expectations anything concrete will emerge from the summit.

The absence from the summit of new Greek Prime Minister Antonis Samaras due to eye surgery further complicates the outlook for the gathering.

Greece's ruling coalition has appointed Yannis Stournaras, a respected economist and former banker, as the country's new finance minister.

Stournaras was appointed to the post after the coalition's first pick, Vassilis Rapanos, declined the position due to health reasons. It was not immediately clear whether Stournaras will represent Greece at the summit.

The new Greek governent has said it wants to renegotiate the terms of Greece's agreement with international creditors after elections gave strong support to parties opposed to austerity measures.

A German government spokesman said on June 25 that no decisions were expected at the summit on easing the terms of Greece's bailout agreement.

With reporting by Reuters and AFP