Anglo Irish bank to be nationalized
Read more about: Economy 
Developing story (here’s the Finance statement)… will the government now use it as a “bad bank” for troubled assets from the other banks? One quick thought: some sense has prevailed since the proposed capital injection far exceeded the stock market valuation of the bank. Its liabilities are already government-guaranteed. And it had made IFSRA look silly. So it was always going to seem tempting to buy the whole thing, especially with the political opposition that made clear the original bailout was not going to get a Tallaght Strategy assent.
But there is one big problem. How does this not politicize the decision about how to handle Anglo’s exposure to ongoing property projects?
UDPATE: There’s at least one strange thing in the emergency legislation. A provision (see page 11) seems to target a situation where someone is both a large borrower from the bank and a large depositor in it and might try to withdraw the deposit before the government takes over the bank.
FINAL UPDATE: The Financial Times interpretation is very interesting — the bank had to be nationalized because the guarantee was about to triggered, which in turn would have caused a fiscal crisis.
The Irish move was prompted by fears that the bank could be declared insolvent and triggering the state’s guarantee, leaving the government responsible for settling close to €50bn (£45bn) of bank liabilities.
So in strange way, the government had to nationalize the bank to keep its debts off the books!
Lenihan’s comments at the press conference are interesting :
So it was the reputational damage that Fitzpatrick’s loan did which broke the camel’s back, so to speak? Either that or it was the due diligence which opened up some horrendous numbers-turning the recapitalisation into a black hole. A solvent bank being nationalised is either a bigger mess than we thought or it is a case of taking out the bank when it is politically easiest to do so.
Also interesting to note that cowen had to run a cabinet meeting from Tokyo. What bad timing and bad optics to be out of the country when a bank is nationalised.
Cowen should have cancelled the Japan trip last month. The Anglo EGM was sitting there as a predictable landmine since that time. Notice also today the confirmation of rumours that some of the directors’ loans were to buy shares in Anglo.
SOLD!
Anglo Irish Bank Hole In Ground Bought By Taxpayers for €450 Million.
http://galwaytent.blogspot.com/2009/01/sold-hole-in-ground-bought-by-taxpayers.html
By nationalising Anglo Irish Bank the taxpayers have just bought a hole in the ground for €450,000,000. The former glass recycling site where 300 Ringsend workers were fired is now worth perhaps €45 million, or less. The exact value is a secret and even if Anglo Irish Bank published a value who would believe them?
Is this Galway Tent directed bank-and-developer-rescue a legal theft of more than €400 million of taxpayer’s cash?
The cross-contaminated(a) Dublin Developer’s Autocracy (DDDA) is a co-investor in the site along with the Becbay group of property developers. The Dublin Developer’s Autocracy also decides the planning permission and denied a conflict of interest, at a June 2008 statutory public event.
Anglo Irish Bank provided €288 million for the site (Did Mr Quinn invest €288 million in Anglo?). One of the developers is obliged to pay seventeen percent interest (17%) on money borrowed from someone. Perhaps to someone with an interest in Bolivian airlines.
The site has been excavated and is now literally a hole in the ground, possibly even below current sea level, yet somewhat higher than the scuttled Anglo Irish Bank.
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(a) The site is in a contaminated Dublin City refuse dump situated Banana Republic style on Sandymount Strand and on the foreshore of Dublin Bay.
http://galwaytent.blogspot.com/2009/01/sold-hole-in-ground-bought-by-taxpayers.html
hello
bank bad ,loans bad, english bad everything bad
so sad sarah