In an interview with the leading daily newspaper Helsingin Sanomat on Friday, Jan Vapaavuori criticised decision makers for losing perspective by placing demands on an enormous economy such as Spain. He said collateral demands on Greece were justifiable because of the country's poor economic situation.

If Spain defaults on its debts, the continent will be plunged into a serious crisis, according to Vapaavuori.

"I’m not convinced it's in Finland’s best interest," he told the paper of the push for collateral, sparking worry of an impending domestic political crisis. The Helsinki MP is a senior figure in his party, serving as the leader of its parliamentary group after a spell as housing minister in the 2007-2011 government.

'Playing for the Spanish team'

Finance Minister Jutta Urpilainen, the SDP party chair who is leading talks with Spain, said Vapaavuori’s comments may prove costly to the Finnish taxpayer, as his statements could derail collateral negotiations that are at a critical stage.

"These comments tell me that Jan Vapaavuori is playing for the Spanish team," she said.

Prime Minister Jyrki Katainen, National Coalition party chair, reiterated that Finland will only contribute to a bailout for Spanish banks in exchange for collateral.

Should Finland reach a deal with Spain on the collateral issue, parliament could be recalled from its summer recess next week.