The move highlighted the weakness of the banking sectors of some euro zone members, which are already suffering from fiscal problems and struggling to bring down their budget deficits.
Spain's largest workers union said on Monday the country was heading for a general strike in protest at the government's austerity measures, although it preferred not to call one.
"Essentially the Bank of Spain news was an excuse for more selling, and the longer-term picture in euro/dollar is lower," said CMC Markets analyst Michael Hewson.
"There are wider concerns that a debt problem can't be solved with more debt and about the effects of austerity measures on growth," he added.
You mean austerity measures might not fix this problem either? Somebody better tell Mike here that he needs to get on the approved script, that austerity measures are the way to go...because they're coming here at some point.