Anglo Irish Banks - a new addition to Public Sector

Agent J

I just had a horrible thought.

What if they appoint a new junior minister to oversee Anglo?

stepbar

Mr.Micro wrote: »

Post 50, but I can see there is no point in discussing this further.

Maybe then I'll refer you back to post 47 and 49. Sure there's no point dicussing this any further because you've already made it clear that you've no point to discuss at all.

stepbar

Agent J wrote: »

I just had a horrible thought.

What if they appoint a new junior minister to oversee Anglo?

God forbid, maybe Bertie might come back as a consultant.....

gurramok

Interesting here http://www.guardian.co.uk/business/2009/jan/15/irish-government-bank-takeover

'Had the bank gone out of business a number of sectors of the economy would have been under threat particularly health insurance, sources said in Dublin.'

Quinn comes to mind!

Mr.Micro

stepbar wrote: »

Maybe then I'll refer you back to post 49.

What are you going to do bore me to death, with your banking know how, and tell me all about interbank loans and how the greedy banks here are not to blame in handing out massive loans to all and sundry, borrowing from Japan at virtual zero interest rates and loaning out money here at higher rates, massive loans to developers with little or no collateral?....... and in the end its not their fault. Its the sub prime market imported from the US...... NO, failing banks means incompetent management and poor practices tolerated by poor regulation. Its happened, its not a hypothetical. Goodnight.

stepbar

gurramok wrote: »

Interesting here http://www.guardian.co.uk/business/2009/jan/15/irish-government-bank-takeover

'Had the bank gone out of business a number of sectors of the economy would have been under threat particularly health insurance, sources said in Dublin.'

Quinn comes to mind!

Well that's a given TBH. A no brainer per se.

stepbar

Mr.Micro wrote: »

What are you going to do bore me to death, with your banking know how, and tell me all about interbank loans and how the greedy banks here are not to blame in handing out massive loans to all and sundry, borrowing from Japan at virtual zero interest rates and loaning out money here at higher rates, massive loans to developers with little or no collateral?....... and in the end its not their fault. Its the sub prime market imported from the US...... NO, failing banks means incompetent management and poor practices tolerated by poor regulation. Its happened, its not a hypothetical. Goodnight.

Certainly I will bore you to death when it's you who has no real understanding of how things work. But lets not let that get in the way of real debate...... sorry I just have to lol at the speel you've came out with there.....

nesf

Dob74 wrote: »

I dont think a libertarian would be the best to review our regulation standards?

My sub title is a joke. But yeah, I agree with you.

nesf

Mr.Micro wrote: »

What are you going to do bore me to death, with your banking know how, and tell me all about interbank loans and how the greedy banks here are not to blame in handing out massive loans to all and sundry, borrowing from Japan at virtual zero interest rates and loaning out money here at higher rates, massive loans to developers with little or no collateral?....... and in the end its not their fault. Its the sub prime market imported from the US...... NO, failing banks means incompetent management and poor practices tolerated by poor regulation. Its happened, its not a hypothetical. Goodnight.

Heaven forbid anyone actually start talking about what happened or the meat of the issues at hand rather than generalise broadly on topics they know little about.

gurramok

Lovely
http://www.independent.ie/business/irish/what-the-implications-are-for-savers-and-investors-as-state-takes-over-anglo-1603883.html

At the end of September Anglo had gross assets of €101bn and a total loan book of €72bn.

By nationalising Anglo the Government has nationalised Anglo's assets and liabilities also. If most of Anglo's loans turn sour then the national debt, currently €50bn, could almost triple.

What does the nationalisation of Anglo mean for Ireland?

The Anglo nationalisation is going to further push up the cost of borrowing. Earlier this month the Government paid a premium of 1.5pc over German bond yields when it borrowed €6bn last week. With the Government set to borrow up to €20bn this year the nationalisation of Anglo is going to push up the cost of government borrowing even further.

Lets pray not alot of that €72bn is called upon. :eek:

OhNoYouDidn't

jlang wrote: »

Should shed some light on how indebted the big property players are, or will the new owners of the bank be as reluctant to mark-to-market as the old? I can't see any return to normality until there's major bankruptcy among the developers and a fire sale of their assets.

my reading of this is the bank has been nationalised in order to insulate the developers a bit longer. easier to deal with a nationalised Ango than Wall Street bottom feeders.

No point owning politicians and not calling it in when the brown stuff hits the fan.

grahamo

NewDubliner wrote: »

From RTE

Does this mean we just saved ourselves 1.5bn?

Will the Anglo staff have their pay adjusted?

I'm sure FF and their crooked fatcat mates will have lots of fun now they have their very own bank to play with!

jmayo

Oracle wrote: »

Could the government develop Anglo into the much talked about, but never launched, "third force" in banking? This seems to be the perfect opportunity, albeit at the most difficult time.

It is too far gone unless you want to spend billions for the next 20 years :rolleyes:

gurramok wrote: »

One thing hasn't been mentioned yet here, it looks like the state is taking on all Anglo's debt now. We're talking billions of euro in a time of a national balance sheet crisis, i just hope Lenihan knows what he is doing.

What is the property relaetd loans, 70 billion or something in that area and maybe with anything upto a 20% defualt rate ?

The government have affectively fastened one of the lifeboats to the stern of the titanic :mad:

stepbar wrote: »

No regulations? Lol. Every bank signed up to the Basel accord would have been required to set aside capital for each and every loan approved. The Irish system is one of the most regulated in the world. You take what you want out of that one. The US on the other hand is not.

Yes but it looks like between the government, dept of finance, central bank and the gobsh*** that was regulator, the banks were allowed do what they liked. Did they never believe the gravy train was going to arrive at the final stop ?

Anglo looks like they were the worst culprit and now they are a taxpayer problem.
But I suppose it's either the fault of the American subprime market or the developers.
Bankers are no way at fault, am I right ? :rolleyes:

Sure the fundamentals are still sound :rolleyes:

gurramok

70bn is about right. http://archives.tcm.ie/businesspost/2008/10/12/story36683.asp

Anglo Irish has 80 per cent of its €73 billion book in British and Irish property. Price falls of between 20 per cent and 30 per cent are expected here

This is relevant when we ask just how much money the banks have lent out for property. Anglo Irish has 80 per cent of its €73 billion book in British and Irish property. Price falls of between 20 per cent and 30 per cent are expected here. But just how would that affect Anglo Irish’s bad debts?

AIB has 52 per cent of its loan book out to British and Irish property, while Bank of Ireland has 71 per cent.

Last weekend, Sean FitzPatrick, chairman of Anglo Irish, said this 80 per cent figure was wrong and that its exposure to property was closer to 20 per cent, which equates to the percentage of its loans that were given out for landbank purchases and development purposes.

He emphasised that where €10 million or €20 million is lent out for a customer to buy a commercial property, which in turn is rented out to a fast food chain and a jewellery shop, falling property prices are not the issue.

Once the customer keeps meeting the repayments, the value of the property is not a problem, even if it falls. The difficulty with this version of reality is that the wider economy is also affected by the downturn. A slowdown in the real economy will affect rents.

In the event that the customer defaults on the loan, and the bank has to seize the property, its security is worth perhaps a half or two thirds of what the bank is owed. The banks have to prepare for such scenarios.

Auditors will have a key role in deciding whether property valuations need to be done by the banks before they sign off their accounts. According to one accountant, who has also sat on the boards of two banks in the past, the auditors will take a look at sample accounts and how they are performing.

‘‘They will look at examples of stressed loans and whether a new valuation of the property needs to be done to assess the level of security,” he said.

However, there is massive scope for the banks to classify loans in different ways. ‘‘For example, if a customer is meeting the repayments on a loan, but is only managing to do it by selling off other assets, is that a stressed loan or not?” the accountant said.

Accountancy sources say the banks are not taking on property valuations this year and are not in any hurry to do them. However, the auditors will have to decide whether property valuations would in fact show the banks’ exposure to clients and the need for write-downs.

One bank source said that some loans were structured in a way that was formally based on a loan-to-value ratio.

‘‘If the auditors insisted that a property valuation be done, then the loan would be too high relative to the value of the security and they would have to insist that the customer pay up more cash,” the banker said.

‘‘If they don’t have it, then it would trigger a whole series of events.”

Such a move would create huge difficulties for the banks and could lead to a domino effect in property write-downs. Anglo Irish, whose chief executive is David Drumm, is audited by Ernst & Young. Bank of Ireland, whose chief executive is Brian Goggin, has PWC as its auditor. Both AIB, headed by Eugene Sheehy, and Irish Life & Permanent, led by Denis Casey, are audited by KPMG.

Do you believe Sean who has been exposed as corrupt?

All it takes is 10% in this crash (Uk & IRL) and you can add billions to the national debt

The_Conductor

Cool.... a 180% increase in the National Debt at the stroke of a pen.......

Mr.Micro

nesf wrote: »

Heaven forbid anyone actually start talking about what happened or the meat of the issues at hand rather than generalise broadly on topics they know little about.

What's your problem? I did not see much input from you on the issue apart from snipe. If I am so wrong in my opinion point it out or be quiet. Its an opinion forum not a court of law, lighten up. Ban me now if I am out of line for having AN OPINION.

How dare you make value judgments saying I know little, I had the courage to post my opinion based on what I have seen, experienced, more than you did. There are no financial experts if there were none of the global meltdown would have happened as they would have seen it coming. I still have my money, the banks don't have theirs, oh they do mine and every other taxpayers.

Darragh29

I'm listening to RTE radio here on the web, listening to one D4 loo laa after the other, detached from reality snobs, ringing in giving out about Anglo and that they lost their money.

What part of "share price can go up as well as down", so these gimps do not understand??? These investors simply made bad investment decisions, end of story. DEAL WITH IT!

K-9

Darragh29 wrote: »

I'm listening to RTE radio here on the web, listening to one D4 loo laa after the other, detached from reality snobs, ringing in giving out about Anglo and that they lost their money.

What part of "share price can go up as well as down", so these gimps do not understand??? These investors simply made bad investment decisions, end of story. DEAL WITH IT!

True, not much sympathy for the Sean Quinns of this world, but some pensioners who invested I would have. Jaysus, this bank was being held up as a shining example a year or 2 ago. Mad!

mike65

I think Darragh29 prefers to view everything as a class war. Sounds posh = deserves it.

Darragh29

mike65 wrote: »

I think Darragh29 prefers to view everything as a class war.

I've been listening to idiots here telling the country "I have investments in every Irish Bank". Good, great for you. Now you've lost money so please go see your therapist if you have trouble dealing with this. These people set out to make a killing and it backfired on them because they thought that they were playing it cute but the people running the bank were playing a cuter game than them!

It happens, get over it!

Darragh29

This auld wan is after saying in RTE that she invested in Anglo Irish shares as she thought in her own words, she would make a killing"!!!

Well guess what dear, there is no more easy money!!!

K-9

Darragh29 wrote: »

This auld wan is after saying in RTE that she invested in Anglo Irish shares as she thought in her own words, she would make a killing"!!!

Well guess what dear, there is no more easy money!!!

Don't you know Banks are Blue Chip Companies?

nesf

Mr.Micro wrote: »

How dare you make value judgments saying I know little, I had the courage to post my opinion based on what I have seen, experienced, more than you did.

Courage? What courage does it take to offer an opinion on a forum? You make a statement on here and guess what, people might disagree with you and try to get you to back up your opinion with some facts or figures. You know, debate...


Read my posts on the Economics forum if you want to see my opinions on the Anglo situation or economic matters in general. There being more than one place to discuss this and all that.

The_Conductor

Darragh29 wrote: »

I've been listening to idiots here telling the country "I have investments in every Irish Bank". Good, great for you. Now you've lost money so please go see your therapist if you have trouble dealing with this. These people set out to make a killing and it backfired on them because they thought that they were playing it cute but the people running the bank were playing a cuter game than them!

It happens, get over it!

While I have little sympathy for those who wish to 'make a killing'- banks were held up as the safest possible investment for pensioners- as they had a guaranteed dividend which could be compared to an annuity payment. It was that way for years. Banks also traded at conservative levels of 6.5-8 times annual earnings. By buying bank shares- you were not looking at the share price- you were looking at an annual dividend that you would live off.

There are lots of pensioners out there badly burnt by the whole mess- who invested their life's earnings hoping for nothing more than a reasonable annual dividend that they could use to make their retirement a little easier.

These people are far more numerous than didicums looking to make her killing on the stock market.......

The_Conductor

nesf wrote: »

Read my posts on the Economics forum if you want to see my opinions on the Anglo situation or economic matters in general. There being more than one place to discuss this and all that.

We've also a good thread over in Accommodation/Property.....

S.

nesf

smccarrick wrote: »

We've also a good thread over in Accommodation/Property.....

S.

I'm wasting enough of my time as is just responding to threads on Economics!

*gets back to work*

The_Conductor

nesf wrote: »

I'm wasting enough of my time as is just responding to threads on Economics!

*gets back to work*

Lol......

dodgyme

Darragh29 wrote: »

I've been listening to idiots here telling the country "I have investments in every Irish Bank". Good, great for you. Now you've lost money so please go see your therapist if you have trouble dealing with this. These people set out to make a killing and it backfired on them because they thought that they were playing it cute but the people running the bank were playing a cuter game than them!

It happens, get over it!

I completely agree. - I lost money on bl**dy eircom shares etc, the bank manager, government (AKA Mary O'Rourke) etc all telling me to buy, so I did and I lost money when I had very little. Anyhow so what ! you are right, I am not stupid and I was taken in. Thats life. I took the risk. Maybe they need to check what the word means.

I rem at the time FG came up with this hair brained idea to compensate people who lost out on eircom shares and taxi drivers etc after deregulation. I thought these idea were crazy even though I would have benefitted. Its a market for god sake.?? I took the risk and lost. If I loose at poker I dont ask for me money back?

Mr.Micro

nesf wrote: »

Courage? What courage does it take to offer an opinion on a forum? You make a statement on here and guess what, people might disagree with you and try to get you to back up your opinion with some facts or figures. You know, debate...


Read my posts on the Economics forum if you want to see my opinions on the Anglo situation or economic matters in general. There being more than one place to discuss this and all that.

Less of the sarcasm might serve you well IMO. I gave my opinion on this topic and I do not expect anybody or everybody to agree with it. As far as facts and figures go its been all over the news, media, the net it hardly needs spelling out by me, what would be the point as its all over in the Economics forum I guess.

Rebeller

Anglo Irish Bank Bill 2009, Section 8(8) wrote:

If the Attorney General considers that an order under subsection (5) contains matter that is commercially sensitive [my emphasis], he or she may direct—

(a) that the obligations in relation to the order under section 3(1) of the
Statutory Instruments Act 1947 are to be taken to be satisfied by the
printing, sending to the institutions mentioned in section 3(1)(a),
publication and sale of a version of the order from which the
commercially sensitive matter is omitted, or

(b) if the preparation of such a version would be impracticable, or would
result in the version being seriously misleading, that the order is
exempt from the operation of section 3(1) of that Act.

Now I wonder why such a provision should be inserted? Maybe to prevent the taxpayers, who now own the bank, from finding out the truth about the bank's current financial status.

Direct download of draft Bill from Dept. of Finance website here.

EDIT: Just to perhaps clarify the above quoted section. It seems to be suggesting that if the AG considers that a Ministerial Order (issued pursuant to the Bill) "contains matter that is commercially sensitive" then it does not need to be published with the result that the Minister can effectively act in secret!

Where's the public accountability in that?