And Tipptops / myboyblue is one as well. Christ, the postcount on this site is going to be increasing over the next few weeks.
Seriously though, will all the jobs in the banks be ok?
[quote=“Mac”]And Tipptops / myboyblue is one as well. Christ, the postcount on this site is going to be increasing over the next few weeks.
Seriously though, will all the jobs in the banks be ok?[/quote]
hopefully this move will ensure this
[quote=“dancarter”]Just announced
three way split, gov/priv equity & existing shareholders
Not just for Anglo for all the banks under the gtee I think. not sure of full detail yet[/quote]
Seriously? Haven’t seen anything on that anywhere yet.
i think its true- i got a text along those lines too
Looks like we could all be glued to the 9 o clock news for confirmation so
I’ll be watching the American Football so please post an update if there’s anything about it on the news.
http://www.finance.gov.ie/viewdoc.asp?DocID=5604
Statement by the Government on the Recapitalisation of Credit Institutions
The Government has today decided on an approach to the recapitalisation of credit institutions. The Government’s objective is to ensure the long-term sustainability of the banking sector in Ireland and to underpin its contribution through the availability of credit to individuals and businesses in the real economy. This initiative will help to foster and encourage the flow of funds to the economy, and limit the impact of financial market difficulties on businesses and individuals.
The Government noted that recapitalisation is recognised by the European Commission as one of the key measures that may be used by Member States to preserve stability and proper functioning of financial markets, and that it believes that in current market conditions even fundamentally sound banks may require additional capital to respond to widespread market perception that higher capital ratios are appropriate for the sector internationally.
The Government decision followed the Minister for Finance’s statement of 28 November 2008 which confirmed the State’s willingness to supplement and encourage private investment in the recapitalisation of credit institutions in Ireland with State participation.
In that context, the Government has decided either through the National Pensions Reserve Fund or otherwise and subject to terms and conditions, to support, alongside existing shareholders and private investors, a recapitalisation programme for credit institutions in Ireland of up to €10 billion.
The State’s investment may take the form of preference shares and/or ordinary shares and the State may where appropriate participate on an underwriting basis. In principle existing shareholders will be expected to have the right to subscribe for new capital on the same terms as the Government.
A key principle in the operation of such a fund will be to secure the interests of the taxpayers through an appropriate return on, and appropriate terms for, the investment.
The next step in this process will be for the Minister for Finance to initiate detailed engagement with the credit institutions themselves in respect of specific proposals.
In order to safeguard fully the interests of the taxpayer, State investment will be assessed on a case-by-case basis in an objective and non-discriminatory manner, having regard to the systemic importance of the institution, the importance of maintaining the stability of the financial system in the State, and the most effective and economical use of resources available to the State and each credit institution’s particular requirement for capital. Any State investment will be undertaken in line with best practice in the EU and elsewhere and consistent with EU State aid rules and in particular the recent European Commission communication on recapitalisation.
Recapitalised institutions may be required to comply with such requirements as to transparency and commercial conduct as the Minister sees fit.
The National Pensions Reserve Fund Act, 2000 will be amended, as necessary.
Discussions with the relevant credit institutions are ongoing, and the institutions continue to progress proposals for private investment. Institutions are being asked to submit their proposals by early January.
The Government guarantee Scheme remains in place.
14 December 2008
spoken like a true civil servant
Just announced
three way split, gov/priv equity & existing shareholders
Not just for Anglo for all the banks under the gtee I think. not sure of full detail yet
Yet again TFK beats RTE to the news.
Bank recapitalisation programme announced
Sunday, 14 December 2008 20:46
The Government has announced support for a recapitalisation programme of up to 10 billion for credit institutions.
In a statement issued this evening, it said its objective was to ensure the long-term sustainability of the banking sector in Ireland.
The Government said it would support the programme alongside existing shareholders and private investors, and would underpin its contribution through the availability of credit to individuals and businesses in the real economy.
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After a day long meeting with bank chiefs, Minister for Finance Brian Lenihan confirmed that money from the National Pensions Reserve Fund will be used in the recapitalisation programme.
State investment will take the form of preference and/or ordinary shares in the institutions receiving funds.
Mr Lenihan said State investment would be assessed on a case-by-case basis and all the institutions were being asked to submit their proposals by early next month.
I’m surprised at the government’s decisive action. My mole at the talks between the government and the banks confirmed that the Minister was adamant that the banks needed to be recapitalised (and also that he was firmly of the opinion that consolidation of the banks was necessary). The banks insisted their capital ratios were adequate (despite fannying around with private equity cunts) and resisted all talks of mergers/takeovers. Then things went a bit quiet and I thought it would be put on the long finger until the new year. But the patriotic Minister had other ideas. Does this give me access to the Dil bar?
Seems like they’re keen to take huge sums of money off people keen to buy up shares in the banks at a low cost and allow them to sell out in a few years for a small fortune. Selling off huge stakes to private investors. Don’t fully understand it yet but if nothing else I’m sure it’ll stabilise the industry.
Don’t think the action was that decisive Bandage.
This was the last resort. It appears that the bulk of private equity funding walked away following their own due diligence. The deal proposed means private equity will only get in when the government are getting involved as well, which would/should provide them with more comfort.
I won’t tell you your business Bandage, but for the non bankers, the real issue is thus (NB: this is my reading of the situation)
- Anglo share price has been dropping like a stone for 12 months +
- At current levels Anglo were majorly at risk of going tits up
- If this had happen it would have left a massive amount of clients in limbo, any vultures would have been very unwilling to take, say, the riskiest 30bn of Anglos loan book on there books.
- These facilities would then be defaulted when they matured (most would be short term facilities, maturing 6monthly/annually)
- Every Banks standard documentation contains a cross default clause i.e. being in default with Bank A means an automatic default with Bank B. This was previously included as a protectionist measure by the Banks.
- Say so for example dancarter defaults on a 50mln loan with Anglo, but has 150 mln facilities with AIB which are then auto defaulted.
- AIB needs to massively increase the level of capital it holds in reserve for dancarter loans as they are in default.
The domino effect would have been ridiculous, it wouldnt just have been clients collapsing, it would have been banks.
Let’s all hope so, i can’t take much more of this uncertainty.
I’m sure you’re awake every night worrying alright Jugs
Sean Fitzpatrick, well well well.
What a monumental fuck up.
Anglo down to 28 cent at one stage this morning. Good to see the Irish nationwide facilitiated them as well.
All banks down this morning as a result.
A disgrace by Anglo who drove the market into the state its in, as much, if not more than anyone else.
Id say there is a lot more to come out of this story. I can think of one other high profile member of the Anglo board who may have recieved facilities to purchase stock in the company
The Regulator caught it so it appears.
Where were the auditors? That is another question that will be asked.
[quote=“farmerinthecity”]The Regulator caught it so it appears.
Where were the auditors? That is another question that will be asked.[/quote]
The regulator knew about this for months it appears.
Id say the auditors are covered, they moved the loan off the balance sheet for year end i.e. refinanced it with Natiionwide for a month and then rebooked it with Anglo when the year end was over. So technically the auditors were probably OK to sign off on the finals, ethically is another question. (unless the tactic was ‘suggested’ by any external professionals)
What do you auditors think?
The way I look at it is if the Regulator can catch it then the auditors should be able to as well.
Alas, Anglo are a big client, deadlines were probably ridiculous to audit them so the thing was missed.
[quote=“farmerinthecity”]The way I look at it is if the Regulator can catch it then the auditors should be able to as well.
Alas, Anglo are a big client, deadlines were probably ridiculous to audit them so the thing was missed.[/quote]
Ya thats understandable. I dont understand the whole audit process so bear with me
if the loan was gone off the Banks loan book, i.e. there was no directors loan at year end, then how/why would the auditrs have spotted it/be required to report it?
BTW, id say tjhe regulator caught them because nationwide were not in a position to refinance the debt this year due to a lack of capital maybe, so they were caught between a rock and a hard place. The regulator had missed it for years as well