THE BRITISH government has rubbished reports that it is drawing up plans to rescue tens of thousands of British expats from Spain in the event of a banking collapse.

The story - which appeared in several UK national newspapers at the beginning of the week, based on an article in the Sunday Times - had caused wide-spread panic amongst expats along the Costas.

The reports alleged that the Foreign Office is putting contingency plans in place to help thousands of Britons if they were unable to get to their money in the event of a ‘catastrophic banking collapse'.

They stated that the Foreign Office is concerned that those who have invested savings would face losing their homes in Spain if banks called in loans and they were unable to access money.

An article in the Daily Mail alleges: "Among options being considered for a 'nightmare scenario' include sending planes, ships and coaches to evacuate expats - some through Gibraltar.