Ratings agency Moody's has cut the credit ratings of 16 Spanish banks, a further blow to a country that is struggling to deal with the bad debts of its banking sector.

Inigo Fernadez de Mesa, a junior minister at the Spanish treasury, told Today presenter Justin Webb that there was no liquidity problem in the country and he was not considering the possibility of a bank run.

We are facing difficult times but the Spanish economy is performing well, he said.

"We are very aware of what the difficulties in Spain are and we are taking the necessary measures", he said, adding that the country does not need any help from the EU.

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