Spain earmarks 10.6 billion euros in loans, grants to flood victims

MADRID (Reuters) -Spain has earmarked 10.6 billion euros ($11.55 billion) in loans and grants to help the victims of the flash floods that hit the eastern coast of the country around Valencia last week, Prime Minister Pedro Sanchez said on Tuesday.

Sanchez said the government plans to spend as much as 838 million euros in direct cash handouts to people affected by the floods that left 217 dead last week in the worst such disaster in Spain's modern history.

The government's credit agency ICO will guarantee as much as 5 billion euros in loans to small and medium companies, self-employed people and families to finance reconstruction efforts.

Further funds will be dedicated to providing those affected with tax and benefit payment holidays, as well as payments for replacement of property and repairs to roads and railways.

The government has deployed 14,898 police officers and soldiers in the areas hit by flash floods, he added.

($1 = 0.9175 euros)

(Reporting by Charlie Devereux, editing by Inti Landauro and Aislinn Laing)