Categories
Banking

Bondholder’s Identity Revealed

Well, chuckled Pat Kenny, as his guests speculated on the identity of the mysterious bondholders, we can leave the Chechen Mafia to one side.

He was rightt.

It’s the Russian Mafia.

It now turns out that one bondholder of Irish Nationwide is Mr Roman Abramovich, billionaire owner of Chelsea FC.

Irish Nationwide, I might remind you, is not a bank but a building society, and yet is receiving €5 billion of your money to make sure that its bondholders don’t suffer thanks to the greed of Fingers Fingleton.

Now we learn that Abramovich is threatening to take legal action against Ireland if the government tries to make subordinated bondholders carry some of the losses of the collapse.  Subordinated bondholders, I should add, are people who took a higher risk in the hope of a higher return.   To put it another way, these are people who gambled on losing their money.  Therefore, even if the government forces Abramovich to take a loss, he will still get back some of his bet, thanks to you, the taxpayer.

As I’ve said before, there was no need to bail out the investors in Irish Nationwide or Anglo-Irish Bank.  It was a scam and a fraud.

As the December budget approaches, we face savage tax increases, and cuts in services to the old, the sick, the poor and the weak.

How do you feel about having less money in your pocket, longer and longer waiting times in A&E and potholed roads, to make sure Roman Abramovich and his pals in the Russian mob don’t lose out on their gamble?

Here’s an EU report on winding up Danish banks.  It states that burden-sharing is ensured by excluding shareholders and subordinated debt holders of the failed bank from any benefit from the aid.  It also confirms that this is in line with the Commissions guidelines.

So.  If it’s acceptable for the Danes to stiff the subordinated bondholders, why would it be wrong for us to do so?

Categories
Banking

The Anglo Scam — Greens Finally See The Light

Everywhere you look, lightbulbs are coming on.

In Brussels.  In the markets.   In the Financial Times.

Even in the Green Party HQ.

Isn’t it just as well Gormley didn’t manage to completely  rid the country of lightbulbs?

At last it’s beginning to dawn on the party that knows better than everyone else, that it was a monumental disaster to bail out Seán Fitzpatrick’s Anglo scam.  They’re beginning to realise that there’s something wrong with pouring all the EU structural funds Ireland ever received into a failed property bank.  They’re slowly starting to grasp the fact that we could have allowed Anglo to fail, and let the international gamblers get stuffed.  They’re finally getting it clear in their holier-than-thou heads that it was all a lie, and we would not have to stump up €70 billion, despite what Lenihan and Cowen said.

It was all a lie, which Eamon Ryan and John Gormley vigorously defended until it could be defended no more.

We could have allowed Anglo to collapse while still protecting the depositors, and this is where Willie O’Dea’s latest demand to jail the bankers is so misleading.  By all means, fling them in a cell.  I don’t care if they rot in a dungeon, but it was not the banks’ mismanagement that screwed the country.  That honour goes to Lenihan for his insane and unnecessary guarantee.

We committed another €4 billion to a thing that was a bank neither in name nor nature: Irish Nationwide Building Society, and nobody has been able to explain why.

Willie was part of the cabinet that agreed to this lunacy, and if he truly believes what he said about arresting wrongdoers, he should hand himself in to the authorities right now and admit his part in the destruction of his country.

The Greens, meanwhile, might finally have developed some sort of backbone, though that remains to be seen.

Perhaps, in  the certain knowledge that they’ll be annihilated come election time, they’ve decided to do one decent, principled thing and shoot the Anglo monster in the head before it devours us all.

___________

More on Anglo

Categories
Banking

Bishop Fingleton’s Mental Reservation

Fingers Fingleton’s years in the seminary weren’t a complete waste.  He really would have made a marvellous cleric, though of course he did go on to become the High Priest of an equally corrupt institution. And just like a bona-fide Church cleric, he became an abuser — a financial one — abusing an entire country to the tune of €4 billion.  I don’t know if he was born a hypocrite  or developed his mental reservation skills on the job.  Perhaps he picked it up in the seminary.

Certainly, his ability to deny reality and to evade a straight question would make any bishop proud.

When RTÉ’s David Murphy caught up with Fingers at Dublin airport, and asked him if he was remorseful, he agreed that he was.  When pressed about having regrets, he blanched the matter with a smug, patronising and prelate-like “we all have regrets”.  When Murphy asked him, having cost the country billions through his mismanagement of Irish Nationwide, if he would now be handing back his million-euro retirement bonus, old Fingers deflected the question by saying that he had already made a public statement on the matter. If he did, I’m unaware of it, but he certainly said nothing to the management of his former company who have received no replies to their numerous letters asking for the money back.

Make no mistake.  That million euros will trim a lot of beards, and every penny of it is coming from your pocket.

However tenuous the argument for the Anglo rescue, Irish Nationwide is a building society, not a bank, and it’s by no means clear why it should be bailed out at all.

There is no rational explanation for it except the conclusion that many senior figures in Fianna Fáil were facilitated with loans, often — as in the case of Bertie Ahern’s girlfriend Celia Larkin — with minimal due diligence.  Fingleton holds embarrassing paper on half the cabinet and half the party.  He knows where the Spanish villas are, and the British apartments, and the slum flats in Dublin, Limerick, Cork and Galway that they haven’t declared for tax.  He has a good idea where the rest of the money came from to buy these properties, and he also provided the loans when these politicians and party functionaries needed cash in a hurry without too many awkward questions.

This is an influential man, well got with the FFers and with the Catholic clergy.  It was Fingleton who facilitated the meetings between Michael Woods and the nuns which finally ended in Woods and Ahern signing away over a billion euros of public finds to pay for the clerical child abuse.

We saw only too clearly the evasiveness, obfuscation and arrogance of the Catholic hierarchy as they dismissed Ireland’s outrage with impatient contempt.  Fingleton is of this breed too, and if he had completed his divinity studies, he might well be one of the purple-robed old frauds who huddle in their palaces, still unable to grasp the fact that abuse is wrong.

He has the same sense of entitlement.  The same bafflement that an ordinary mortal would dare to question him.  The same overweening sense of his own temporal power even as the edifice he created now collapses under the weight of his incompetence and greed.

And yet, he must be kept quiet.

Ireland — you and your children — will be robbed to pay this ransom because the Fianna Fáil party cannot afford to anger Fingleton for fear he might expose the dirty secrets he plays with in the folds of his cassock.

______________________

More on Fingers

Categories
Banking

Fingleton’s Irish Nationwide Loses €2.5 Billion

Irish Nationwide Building Society has reported a loss of €2.5 billion for  2009, and guess what?  You’ll be paying for it.

We don’t know why our government is pumping money into this insane joke of a bank, but they’re doing it anyway, and the only possible explanation I can think of is that it contains secrets too dark to be exposed.

Irish Nationwide is not systemic to our economy.  It’s nothing more than a travelling money roadshow.  A cheap seaside carnival  the same as Anglo.  Two carnivals run by two bunco artists and both propped up by clowns.  How appropriate.

What sort of paper does Michael Figleton hold on our leaders that they can bankrupt our country to keep them quiet?

Michael Fingleton took an ordinary mutual building society and turned it into a  vehicle for bankrolling gobshite developers and cash-strapped politicians.  In the process, through his arrogance, greed and incompetence, he engineered a loss which was greater than the total combined profits of the bank in its entire history.

According to INBS’s new chairman, Danny Kitchen,  the collapse of property markets both in Ireland and abroad gave rise to the impairments but this was exacerbated by the nature of the operation of the business which was clearly a flawed model. The scale of the losses reflects the failure of the Society’s commercial lending strategy which was over reliant on asset value.

What does that mean in English?

It means Fingleton lent his developer cronies money for valueless shit and now there’s nothing to cover the losses.

What Kitchen really meant by a flawed model was that, under Fingleton, Nationwide was not a business at all, but a private kingdom, in which he dispensed favours to those he considered useful.

Chief executive Gerry McGinn said The society has manifestly been seriously under-resourced in many areas of its business activities and support functions, but most especially in commercial lending.

Given the predominance of property based lending in our portfolio, the lack of market activity in our primary markets in Ireland and the UK has not only affected the level of impairments, but it also has constrained our capability to generate solutions to realise value from these assets.

In English, this means Fingleton should have stuck to giving out house loans, but he didn’t, and now we’re broke.

Fingers is an interesting character.  After running his bank into the ground, he was among those Irish businessmen who contibuted millions to the Vatican in 2009 for the restoration of a chapel.  It was Fingers who wrote that cheque for Bertie’s ex-squeeze, Celia Larkin with a minimum of fuss about formalities, and it was Fingers who acted as go-between on the fateful day when Bertie’s messenger boy, Michael Woods,  struck a billion-euro deal with the religious orders over the child abuse in institutions.  This deal, incidentally, committed the Irish taxpayer to cover all the orders’ future liabilities, while they in return paid nothing.

I might just remind you of two things.  The government is putting €2.7 billion of your money into Fingleton’s disaster of a bank, Irish Nationwide, to keep it afloat, while Fingleton is refusing to hand back the €1 million bonus he took, just before he jumped ship, and before the rest of the world found out what a complete shit he’d made of the business.

They don’t call him Fingers for nothing.

_____

More on Fingers

Categories
Economy

No Inquiry Into Banking Disaster, Says Government

I heard Batt O Keeffe on the radio this morning, defending the party line on an inquiry into the banking scandal.

It was the same insulting and dishonest waffle we’ve always got from him and his kind.  Nonsense.

According to Ned, the officials of the Department of Finance are working flat out to make NAMA a reality, which will free up the banks to start lending again, and the last thing these hard-pressed officials need now is another inquiry to distract them from their arduous task.

Wrong, Ned.  Wrong on every level.

The NAMA money will never be lent out to customers.  It will be used to pay the banks’ debts and fill their coffers with cash.  NAMA will not result in  a single small business receiving a loan.

To say otherwise is a plain lie from Ned O Keeffe, who thinks he’s dealing with the Irish public of the 1950s when this kind of pompous guff was swallowed without question.

The reason the Government don’t want an inquiry is because it would expose NAMA for the fraud and con-job that it really is.  And because a thorough inquiry would expose the collusion and involvement of Governemt ministers at the very highest levels in creating the financial disaster that has resulted in the country being robbed to protect the wealthy.

Batt O Keeffe hasn’t two brain cells to rub together.  We all know that.  We all know he was made Minister for Education because the job needed an idiot.  But he’s also the mouthpiece of Brian Cowen, and therefore you can take it that when Batt speaks, Brian is behind him operating his jaw through a hole in his back.

They were all involved and they all knew what was going on.  Last night, on Prime Time, we learned that Charlie McCreevy, who was soon to become finance minister, received a €1.6 million mortgage from Irish Nationwide to purchase a €1.5 million property.  A mortgage of nearly 110%, from a mutual building society, supposedly operated for the benefit of its members.  And we discovered that there was no paperwork involved.  Fingers Fingleton put it through on the nod for this political heavy hitter who would shortly be in a position to make very favourable decisions.

Now, if the finance minister was in hock to a dodgy outfit like Nationwide, then we can presume there was no proper oversight of the system.  How many other ministers and senior Fianna Fáil members were in Fingleton’s pocket?

Professor Patrick Honohan, a man of impeccable credentials and newly-appointed head of the Central Bank, thinks an inquiry is needed urgently and has twice said so, but of course he was appointed by Lenihan who, in fairness to him, had no involvement in the fraud.  Isn’t it interesting that the highly-regarded academic  is certain we need an inquiry as a matter of urgency, while the half-wit who speaks for Cowen, Ahern, McCreevy and the rest of the rotten crew is so against it?

What are they afraid of?

Categories
NAMA

Stealing Your Future To Pay The Banks — The NAMA Lies Exposed

I didn’t write this post.  It was lifted directly from a thread on the Property Pin, because I believe it needs to be shown to anyone with the wit to see what’s being done in Ireland.

Here is the answer to every piece of spin, flim-flam and bullshit thrown at you by every political clown and banking snake-oil salesman.

This is the truth behind Brian Lenihan’s theft of your children’s future.

Be angry.

___________________

We are all to blame, we are all to responsible, we all had our heads in the trough
MYTH/LIE/SPIN

2,000 individual loans make up the 77billion in toxic bad loans the tax payer is taking on.
150 individuals are responsible for 50 billion of the toxic bad loans the tax payer is taking on.
32 Billion of the bank bailout is belonging to just two banks , chaired by two individuals who have since retired Michael Fingleton and Sean Fitzpatrick
There are just over 160 Members of Dail Eireann
There are 84 TDs in Government FF,Green,Independents
There are 81 TDs in Opposition

We have reached the Bottom (I) – Brian Lenihan
MYTH/LIE/SPIN

He provides no report, countrywide analysis or figures to prove this, it is simply a soundbyte.
If we have hit the bottom then where are the buyers flooding the market.
Just as you cant call the top until after the fact, one cant call the bottom either
He is basing this on the rental yields on commercial property in Dublin, which is a small part, of one market in one city in Ireland, Theres no evidence we have reached bottom in Waterford, Cork, Limerick, Nenagh, Thurles, Cahir Borrisonossory, Clifden, etc.
Theres no evidence we have reached bottom in residential property, no evidence we have reached bottom in development land.
Some estate agent commentators still feel we have another 20% to fall.
And by all international standard house prices in Ireland are still over priced.

We have reached the bottom. (II)
MYTH/LIE/SPIN

The governments own adviser contradicts this
ALAN AHEARNE (Economist )Tuesday, September 16, 2008 Irish Times
Two conditions are necessary for a revival in exports: a rebound in economic activity abroad and a substantial improvement in cost competitiveness at home AA Income tax rates will need to rise.
This projected path for economic activity looks implausible. Weak incoming data, a deteriorating outlook for growth abroad and the scale of adjustment in the housing market that has still to take place point to significant contractions in GDP both this year and next. The economy may stabilise in 2010 as the drag from new homebuilding fades, but we will probably have to wait until 2011 for a rebound to strong growth

House Prices have reached Bottom (III)
MYTH/LIE/SPIN

Again the governments own adviser contradicts this and says we wont hit bottom until 2011
ALAN AHEARNE (Economist )
The international experience of housing booms and busts shows that real (that is, inflation-adjusted) house prices typically decline for nearly five years following the peak. Real house prices peaked in Ireland in the fourth quarter of 2006. Typically, house prices give up almost all of the gains recorded in the five years before the peak. That translates into a drop in real house prices here of about one third by 2011.

4-5 Years for Recessions and property crashes to run their course.
MYTH/LIE/SPIN

The government is spinning that the property crash and recession has bottomed out as they only run 4-5 years.
The average length of recent recessions has been 6 years as per a recent Goldman Sachs report.
As this is an average who is to say the length of the recession in Ireland will not be at the extreme of this range.
If peak of the boom was late 2006. we have until late 2011 minimum, best case , late 2012 according to Goldman Sachs and sometime past late 2013 if we are on the wrong side of the average. Again BL still claims we have hit bottom.
If the recession has not run its course and could have legs fro a few more years how can the property market have already bottomed out.

If NAMA hasn’t turned a profit or broke even in 10 years, it means the country/economy hasn’t recovered and so NAMA is the least of our worries.
MYTH/LIE/SPIN

If the country hasn’t recoverd NAMA and the bonds issued will still be an issue and have to be paid off.
And most likely NAMA, and the massive debt it has put on the country will be part of the reason why the country hasn’t recovered.

No cost to the tax payer
MYTH/LIE/SPIN

All government bonds are paid for by the Tax payer.
The tax payer is already hit with levies and increased taxes to fund current borrowing which is set to increase.
The tax payer is already hit with levies and increased taxes to fund the extra borrowing required to pay for the 7 billion already given to the banks.
The tax payer is already hit with levies and increased taxes to fund the extra interest rate on our current borrowing we are being charged on the international markets because the country is in such turmoil.
Outside of NAMA our borrowing is still increasing, all of which will cost the taxpayer.
Bank of Ireland has already received 3Billion Anglo 4 Billion.

Interest on bonds issued is only 1.5%.
MYTH/LIE/SPIN

This is a variable Interest rate. The interest rate will be reset every 6 months and is based on ECB rates. So if ECB rates rise so too will the NAMA bond rates.
If ECB interest rates were to hit 4%, that would mean an extra 2 Billion in interest payments we would have to make to the BANKS who we gave the bonds to for their bad loans .
Experts have said long term ECB interest rates are forecast to increase and could be 3% in the medium to long term

We already own Anglo so the purchase of its loans can be ignored as its one hand of the Govt. paying another hand of the Govt.
MYTH/LIE/SPIN

We have nationalized Anglo but we also pumped 4 Billion euro into it. 4 Billion Euro diverted from other parts of the state, 4 billion we ultimately had to borrow, 4 Billion we still have to pay back, 4 Billion we are paying interest on.

The 7 Billion Premium paid on the current market value was required to get the banks on board.
MYTH/LIE/SPIN

There is no evidence to suggest the banks would not have taken a smaller premium or even none at all.
The market has responded, 30% jump in bank shares , it was the steal of the century and the banks and the markets know that.

All we need is a 10% jump in property prices for NAMA to work.
MYTH/LIE/SPIN

Its more like a 15% jump that would be required for NAMA to break even.
We are still in a falling market, if we fall for another year or two, then we may require a 18,20,25+% jump from that point to get us back to breaking even.
Plus its all pre-supposses we are at the bottom, but what if we are not and lots of international experts say we are not.

House Prices will increase and bring NAMA with it.
MYTH/LIE/SPIN

The ESRI and IMF have already forecast negative growth for next year. How are we going to get rising house prices in a falling contracting economy.

The NAMA model will recapitalize the bank
MYTH/LIE/SPIN

Because the government have not released figures its not apparent this will in fact work.
This will not solve all banks issues they still hav to raise funding on the international markets. ‘The Economist’
In fact AIB have already said they will need to go to International markets for further funding of 2 Billion.

We have reached bottom, the economy will turn around and grow, house prices will increase (10%) all to the benefit of NAMA
MYTH/LIE/SPIN

To improve our competitiveness in a tougher global market we need prices in Ireland to fall more.
To improve Irelands competitiveness we needs costs, salarys, Govt spending , all to go down.
To keep the jobs we have we needs costs, salarys, Govt spending , all to go down.
All this will produce the opposite of rising house prices, it produces falling house prices, people have less money for a house.
Irelands economic recovery and NAMA breaking even are diametrically opposed.

The Long Term Economic Value of the bad loans NAMA is taking represents a good investment
MYTH/LIE/SPIN

The govt seems to have based this statement on the rental yields in Dublin which is a just one commercial segment of the market, worth approx €8bn.
NAMA’s entire estimation of long-term value hinges on rents holding constant in this subset (Dublin) of a subset (commercial projects) of a subset (projects underway) of a subset (Ireland) of the total loan book.

The ECB is backing this plan and giving the Government or banks this money to buy the NAMA bonds
MYTH/LIE/SPIN

The ECB does not buy Government bonds. The banks are using the bonds as collateral to go to the ECB and say we have Govt bonds therefore the ECB will lend to them.
The extent of the ECB guarantee only goes so far as it sets interest rates but the ECB has given no indication it will not raise ECB rates in he medium term, thereby making NAMA a much more expensive solution.
But at no time does the ECB take the bonds, the banks are left with the and could in fact sell them on the open market therby competing with our own NTMA bonds.

Government NAMA 54Billion versus Regular NTMA Govt Bonds
MYTH/LIE/SPIN

The government has given no analysis of what the impact the NAMA bonds will have on the regular NTMA bonds that the government will also be issuing in the coming years to fund our day to day expenses.
There is nothing in NAMA legislation to say what the banks have todo with the NAMA bonds.
There is nothing in the NAMA legislation to stop the banks from selling NAMA bonds on the open market and therefore competing with NTMA bonds .

Fianna Fail will take the hard decisions.
MYTH/LIE/SPIN

FF has a proven track record of letting the bankers and civil servants get off very lightly, golden parachutes etc…
FF has a track record during the boom of not taking the hard decisions.
FF has a proven record of giving every tax break possible to developers, stock market speculators, and builders
FF has a proven record of making very very bad regulatory decisions which got us into this mess.

Dublin Yields at an all time high and this suggests property values are bottoming out Brian Lenihan
MYTH/LIE/SPIN

There is a law in this country that says commercial rents cannot be marked down. Many rents/yields are high only because the current tenant is not allowed by law to renegotiate the rent and get it lower. A new law allows for future leases not existing leases to have downward revisions.
The State is also propping up rental yields, paying 60m per year.
The Govt looking for lower rents and saving tax payers money is diametrically opposed to NAMA keeping rent high.
40% of commercial property is currently empty in some parts of Dublin.
Look around the city the place is awash with offices for rent

The IMF backs the NAMA model
MYTH/LIE/SPIN

IMF 2008 report has stated government backed asset management agencys do not work due to political and legal entanglements

NAMA will get credit flowing
MYTH/LIE/SPIN

There is nothing in the NAMA legislation to FORCE Banks to start lending to ordinary people and SMEs
There is no evidence credit has started flowing yet in the UK and the US after their massive bailouts , in fact credit indexes are showing that credit is actually contracting .

Current Market Value is 47Billion
MYTH/LIE/SPIN

Based on the opinions of many vested interests who have advised the Govt.
Based on the assumption theres is a market for these properties, but there is no evidence a market exists , if no market exists much of this property and land is actually worthless.
Also based on the assumption we have hit bottom.
This figure is pulled from the air. The Govt provides no figures or reports to back this claim up.
Market value assumptions seem to be just based on rent and yields in just the Dublin, which is a very vague amount.
If current market value is 47 Billion then why don’t the banks just sell the stuff for 47 Billion and they wouldn’t need any tax payer money.

GOVT open to other parties contributions
MYTH/LIE/SPIN

Bank chiefs have worn out the rug going in and out to government building meeting with their friends in the Govt.
Bank chiefs were summoned to Leinster house in the days before NAMA at a time when other Govt parties were not allowed access to any of the details even though those parties promised non-disclosure of any info they were allowed to see.

We do not have time to debate this further its time to implement this plan to save the country.
MYTH/LIE/SPIN

The government just spent the last 6 weeks on holidays , there is plenty time to debate and amend this legislation.

FF Spin, all the other alternatives would not work and would cost more
MYTH/LIE/SPIN

Many commentators , including Nobel laureates have stated other alternatives proposed by the opposition parties including temporary nationalization would not only be cheaper, less risky and also implement faster to get credit flowing.
Many economists have said other alternatives are better.

The Government is not doing any favours for its banking buddies.
MYTH/LIE/SPIN

Prior to the nationalization of Anglo, civil servants in the Dept. Of Finance had prepared a proposal to nationalize Anglo and wind it down.
The minister went against this and instead issued a blanket guarantee for Anglo.
Anglo Irish Bank was kept alive for 3 months after the Govt guarantee during which time significant bonuses were paid before it was nationalized.
The two chairmen of the Anglo and Irish Nationawide have been allowed walk away with massive payouts and pensions even though the tax payer is now buying bad loans from their banks for more than 30 Billion Suro.

Government is extracting retribution from the banks
MYTH/LIE/SPIN

The Government didn’t enforce pay restraint on the banks when they had them over a barrel before writing the guarantee, nor
has they taken this opportunity now when we have a chance regarding the premium and is actually paying over the odds
There is nothing in the NAMA legislation to control the executive pay or bonus culture at the banks which we are bailing out.

This is not a bank bailout
MYTH/LIE/SPIN

Not worthy of a rebuttal, complete utter BS

The Government will pursue Developers for full repayment of loans & Govt does not believe developers assets are being hidden
MYTH/LIE/SPIN

The is lots of documentary evidence, historical incidents to indicate most developers have already pocketed large reserves of cash and holdings off shore or transferred assetss to other family members or entities to evade Government acquisition.
For gods sake they do this during the boom time , of course they would be doing this during a downturn.
The government have not costed how much it will cost to pursue these assests.

The Government has been open and transparent
MYTH/LIE/SPIN

Dated subordinated debt was guaranteed by the govt, in its blanket bank guarantee, with no explanation .
Why was this done, this type of debt is taken on with a risk, the investor knows theres a risk, yet the govt gave a guarantee .

The FF Government has already implemented overhaul of the banking industry
MYTH/LIE/SPIN

Over 80% of Irish Banks board members have been in place since before 2008 .
There has been NO clearout of Irish Banks

There will be transpareny and legislation to prevent non-political interference
MYTH/LIE/SPIN

Multiple sections of the NAMA legislation is to be at the direct discretion and exclusively by The Minister of Finance.

NAMA will not need much staffing as the banks will continue to manage the loans
MYTH/LIE/SPIN

Huge legal issues exist here here as well as conflict of interest for bank employees in managing loans belonging to another institution ie. NAMA
Govt has admiteted recently it gave Rody Molloy 1.4 million so that he would not drag the state down the Four courts.
Think what 2000 Developers who are not happy with a valuation could cost the state in legal fees and time.
Rememebr the tribunals some of which are still stuck in legalese.

FF says other proposals involve TOTAL banking nationalisation
MYTH/LIE/SPIN
Many proposals inclunding Labours proposes temporary nationalization of the two main high street banks.

FF Says wholesale nationalisation of banks should be prevented at all costs as international markets will not lend to state owned banks
MYTH/LIE/SPIN

There is no evidence of this , and in fact lots of state owned banks do borrow on the international markets

We must avoid further Nationalisation at all costs
MYTH/LIE/SPIN

Many coutries have already nationalized large financial entities. Or taken much larger shareholding in the banks it did bailout. We have taken a paltry 25% in the banks we have bailed out.

NAMA is akin to the much vaunted Swedish model.
MYTH/LIE/SPIN

NAMA is not like the Swedish Model. In the Swedish model there was much more temporary nationalisation
There was much more punitive measures in the legislation
There was a wholesale clearout of its banking executives.

The Govt, FF and Green Party says Irelands woes were caused by the collapse of Lehman brothers.
MYTH/LIE/SPIN

If you need this explained as to why it is totally bullshit bogus spin then you shouldn’t be reading this .

Green Party party claim they have a proud record of standing up to vested interests.
MYTH/LIE/SPIN

see item above

FF says it is taking every measure to prevent this form of financial corruption and financial irresponsibility from happening again.
MYTH/LIE/SPIN

They and other politicians have said this many times before , remember Ansbacher , off shore accounts, DIRT retention, bank over-charging etc…
There is no evidence to support this in fact the evidence indicates the oppossite

There is no method to stop NAMA from going through.
MYTH/LIE/SPIN

The president has an alternative. Let the people decide for themselves, the constitution provides for the President referring the NAMA bill to a referendum, it being an issue of National importance

Current trading in Irish bank shares is small scale investors and purely speculative
MYTH/LIE/SPIN
Ireland’s Finance Minister Brian Lenihan said trading in Irish banking shares is akin to a “bookie’s office operation” at the moment.
“The value of trading of these shares at this level is highly speculative,” Lenihan said in an interview with RTE radio today. “There has been very little institutional dealing in Irish bank shares.”
Lots of Bloc trades have been issued in recent days, some massive volumes including trades of 1.5m shares in one lot, and the vast majority were trades of blocs of 10k and over. Sure Lenny loads of grannies and day trading students.

This is a good deal for the TaxPayer
MYTH/LIE/SPIN

AIB and BOI have skyrocketed recently because the markets, stock brokers and investors know this is a great deal for the banks.

The NAMA haircut is between 35-40%
MYTH/LIE/SPIN

This may be the average but the bulk of the haircut is on Anglos loan book, the state already owns Anglo. Therefor its onw state body paying another state body. The real focus is what he other non-nationalised banks are gtting.
The haircut the other banks have had to take is very small given how toxic their loans were, in fact for AIB and BOI its 20% or lower.

The NAMA Haircut of 35-40% (20% for BOI and AIB) was a good deal
MYTH/LIE/SPIN

Recently in the high court case involving Zoe and ACC/Rabobank it was accepted by both parties that the haircut on some property loans was in the region of 70-75%.
Recent receiver fire sales of properties have documented falls of over 60% as shown on a Primetime Special
20% haircut for AIB and BOI is not a good deal,

NAMA will Redevelop some Hotel properties
MYTH/LIE/SPIN

Estimates are huge amounts of finished and unfinished hotel projects will come into NAMAs
Currently the Irish hotel industry is in its worst state ever. There is no need for one more hotel room in Ireland
The return on hotel investment is very low, we have over capacity in hotels.

25% Value of loans been taken over by NAMA were covered.
MYTH/LIE/SPIN

Its an acknowledged fact many developers used other properties as collateral for loans. This collateral is now worthless.
Many developers used other loans to finance larger loans… ie Borrow 1 million from one bank to get 10 million from another.
Many solicitors and developers have been found to have multiple mortgages taken out on the same properties, again worthless loans.

NAMA will Redevelop housing projects over the long term
MYTH/LIE/SPIN

There is no evidence to suggest we have ashortage of housing or will have a shortage of housing in the coming years.
In fact we will have net Emigration next year.
Waterford has 4,000 houses for sale
The Midlands is plagued with over supply and overzoning

International commentators are stating NAMA is the best model.
MYTH/LIE/SPIN

The main people saying NAMA is a good deal are DAVY, Bloxham, stockbrokers, AIB,BOI, and also the ex heads of these banks.
These are the main voices saying NAMA is a good deal. The same voices who got us into this mess.

The taxpayer is protected if NAMA does not work out
MYTH/LIE/SPIN

There is no specific levy in this legislation should there be a downside for the taxpayer. There is only a provision for the Minister to ask for one if he decides at a future date we require one. That’s not protection for the taxpayer.
Real protection for the taxpayer would involve explicitly placing a levy in the legislation

We have to do our patriotic duty and swallow this biter pill
MYTH/LIE/SPIN

Why did the government not ask the banks chiefs and FAS chairman who retired to do their patirotic duty and walk away from their pension pots and golden parachutes.

The ECONOMIST Magazine Thinks the NAMA plan is a good plan
MYTH/LIE/SPIN

“The Economist has welcomed it in the sense that its finally doing something but they have also clearly stated who they see as benefiting best from NAMA and it isn’t the Tax payer. “
The government seems to have erred on the side of favouring shareholders, largely to minimise the amount of capital it would have to inject into the banks.
“The trouble is that the banks have run up such large losses that it will be lucky to achieve even two of its three objectives”

The Financial Timess Thinks the NAMA plan is a good plan
MYTH/LIE/SPIN

They have given a guarded welcome to the plan and only in the sense that the banks and markets have responded in a positive manner to the plan. The FT has not stated this is a good deal for the country or the tax payer.
“Property loans are only one problem facing Ireland’s recession-bound lenders”

NAMA will get development value out of the properties it is taking on
MYTH/LIE/SPIN

(The full breakdown is: land (36%), development (28%) and associated loans (36%), we have €21bn, or more than half accounted for, by land
This is the very same land that we have heard has been devalued by anything up to 95% from the peak, due to the probability of a good deal of land being rezoned to agricultural. It’s reasonable to assume that this land splits down in some way between that which probably will be developed (and which has presumably fallen in value by 50%), and that which probably won’t (likely down 90%).

NAMA Legislation will protect the NAMA agency form political interference.
MYTH/LIE/SPIN

Much of the NAMA legislation is very vague and allows for lots of decisions to be made at the exclusive whim of the Minister for Finance .
NAMA is akin to the all empowering PATRIOT Act that Bush pushed thru in the US

The government has driven a hard bargain with the Banks
MYTH/LIE/SPIN

Interim director of NAMA Brendan McDonagh, said the number of loans the banks had earmarked for NAMA had increased significantly since the draft bill was published because banks had reassessed their books.
In two weeks, after the draft legislation the number of loans the banks wished to pass to the tax payer rose from 18,000 to 21,500.

Popular Media are behind NAMA
MYTH/LIE/SPIN

The popular Irish Media, broadsheets and television got it drastically wrong during the boom equally these same entities and same persons in many cases will get it drastically wrong on this matter.

AIB BOI Bank Shares are up …we should celebrate
MYTH/LIE/SPIN

A few years back when bank shares were hitting 18 euro the media thought that was good for the country too, long term it has been PROVEN to be a false economy and of no long term benefit to the nation as a whole.

Trust FF and the government on NAMA
MYTH/LIE/SPIN

FF and the governemtn have gotten so many decisions, agencys , policys wrong they have a proven track record of ineptitude, incompetence and corruption over and over again.. This is another example
PPARS, e-Voting, FAS, Thornton hall, Section 23 hotel breaks, ministers expenses, rezoning, tribunals…etc etc

Not a gamble..
MYTH/LIE/SPIN

Yes it is a gamble

The ECB have not had historical high interest rates
MYTH/LIE/SPIN

Yes the ECB has had high interest rates and is forecast to have so in the medium to long term future
The government has given no analysis of the impact rising ECB interest rates will have on the cost of NAMA

NAMA will Manage property prices without political interference
MYTH/LIE/SPIN

The state will become the largest property developer in the state and possibly the world. It will want prices to rise not fall and we all know that rising prices are not good .
The IMF recommends Governments do not artificially prop up house process, which is exactly what NAMA will have todo for it to work.

The NAMA Model is the cheapest bailout guarantee in the world
MYTH/LIE/SPIN

Taken on a per head of population basis NAMA and the billions we have already put into the banks means NAMA is not the cheapest bailout , in fact its working out more expenseive than the US and UK Model.
And in the US and the UK they have taken larger (75-100%) ownership of some of the financial institutions they have bailed out.

Categories
NAMA

Nama – When Is A Haircut Not a Haircut?

Well? When is a haircut not a haircut?

Answer: when it’s not even a light trim.

Now, I’ve been doing a little calculating, but of course I’m not an accountant or an economist, so this is probably all wrong, but anyway, here goes nothing.

INGLORIOUS
Pic courtesy of C'est la Craic

Yehudi Lenihan announced that Nama would pay €54 billion for the banks’ bad loans, which have a face value of €77 billion: in other words, he says he’s paying 70% of the original value they had when the loans were issued at the height of the boom. These are the values that were assigned when everyone was coked out of their heads and drunk on power and helicopters. Let’s call this the loans’ lunacy value.

Because he’s only paying €54 billion and not €77 billion, this is called a discount.

But wait. That lunacy value of €77 billion includes €9 billion in rolled-up interest, so the loans were actually worth €68 billion at the top of their value. Their lunacy value.

So not only do the taxpayers make sure that the banks get most of their money back after their disastrous lending spree, driven by greed and stupidity. We also make sure that they get the interest they feel entitled to earn on these criminal loans.

But it doesn’t end there.

Because the government nationalised Anglo-Irish instead of letting it collapse like the zombie it is, we’re liable for the entirety of its bad loans, which amount to €28 billion, out of which you have to strip about €3 billion in phony rolled-up interest. We’ll say Anglo’s total bad assets are worth about €25 billion.

I might just add in passing that Anglo-Irish Bank was not a bank in the sense any of us understand, but simply a conduit for passing credit to builders. It had no importance to the wider Irish banking system and could have been allowed to collapse without the slightest impact on our economy. Yet, despite this, our government chose to nationalise it and make its problems our own.

Why?

Well, that’s one of the biggest questions that will have to be answered. Why did Fianna Fáil rescue the developers’ bank when they didn’t have to?

Time will tell.

Let’s see now. Time to recap.

  • Nama gives €19 billion to Anglo.
  • The government tops that up with another €6 billion.
  • Nama gives €35 billion to the rest of the banks.

That makes €60 billion in total, against a maximum loan value of €68 billion, which was their supposed worth at the most insane level of valuation.

That’s 88% of the total inflated value of the loans, when measured at the absolute height of the property bubble.

Isn’t that great? I hope you feel a lot better now, knowing how much you’ve contributed to guarantee the top bankers a sound night’s sleep.

Leaving Anglo out of it, the total face value of bad debt is €49 billion, but you have to take out the proportionate amount of rolled-up interest of about €5.7 billion. (In other words, the interest the banks would like to earn for making insane loans to people who couldn’t possibly pay the money back). We’ll call it €6 billion for round figures. That leaves the face value of the un-nationalised banks’ bad debt at €43 billion.

€35 billion of Nama money goes against this bad debt, so Yehudi Lenihan is actually paying the independent banks about 81% of their lunacy value while their real value might be in the order of €20 billion. Might be. Nobody knows.

So, by my reckoning, Yehudi Lenihan has just suggested that we give the banks’ big institutional investors a free gift of €15 billion.

Now. Have a look at those rough figures and correct me wherever I made a mistake. After all, I’m neither an accountant nor an economist, and I don’t really understand the subtle details of these things.

Now that I think of it, I’m just like our Minister for Finance and our Prime Minister. The only difference is, I don’t have the power to give your money to the billionaires who want it.
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Here’s an interesting question in today’s Irish Times.

If the bank loans for Nama are only worth €47 billion, why is the Government going to pay €54 billion?

Do you have the answer?

If so, please let us have it as soon as possible.  Thanks.

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Meanwhile, Fingers Fingleton enjoys his retirement.

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Also on Bock

Nama for Mister Men

Paying For The Celtic Tiger

Why Are Irish Banks Backing Liam Carroll’s Zoe Group?

IMF report on Irish economy

NAMA Millstone Will Sink Ireland

NAMA Long-Term Economic Value Explained

Economic Treason – Simple Recipe

Asset Management Agency – Ireland’s Bad Bank

Bludget 2009

Budget 2009 – My suggestions

Fingers Fingleton Sole Beneficiary of €27 Million Irish Nationwide Pension Fund

Bailing Out The Property Developers

Business Ideas for the New Great Depression

Sorry? What?

Irish Government Ministers

Denying the Economic Crisis

Anglo-Irish Bank’s Croke Park Corporate Box

The Anglo-Irish Ten, Hiding Behind Client Confidentiality

Irish Bank Guarantees

Sean Fitzpatrick Tells Parliamentary Committee To Fuck Off

Letter To Brian Goggin, Bank of Ireland CEO

Anglo-Irish Bank, Brian Lenihan and the 7-Billion-Euro Fraud

Irish Government Nationalises Anglo-Irish Bank

Categories
Religion

Fingleton Brokered Religious Orders’ Bail-Out Deal With Government

This article was first published in May 2009

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Michael Fingleton secretly met Michael Woods in the lobby of the Shelbourne hotel in 2002, and agreed the terms of the clerical bail-out before the official meeting took place. Fingleton concocted the agreement off the record with Woods, who later agreed — illegally — to exclude the Attorney General from the negotiations, at the insistence of the clergy.

Of course, Fingleton never worried too much if billions of taxpayers’ euros were being sidelined to prop up his bank or his clerical friends, even if it endangered the very stability of this State, as it now threatens to do.

Fingleton was the intermediary who shuttled between Michael Woods and the religious orders’ negotiators before the final deal was struck, in which taxpayers’ money would be used to protect the religious orders from legal action by abuse victims. It was Fingleton who told Woods what the clergy would and would not tolerate. It was Fingleton who laid down the law to the government and instructed them as to what was expected of them. It was Fingleton who helped Woods to work out a deal that would bring least pain to the religious orders, and maximise the burden on the taxpayer.

Fingers Fingleton, as you may know, is the man behind Irish Nationwide, one of the two non-banks that have dragged our economy to the depths. He was the man who ran the bank as his own private fiefdom, and who was eventually forced from office last March. Fingers, you might recall, paid himself a €1 million bonus after the government announced its intention to bail out his zombie bank, and also set up a €27.6 milion pension fund of which he was the sole beneficiary.

Of course, Fingers wasn’t just the most arrogant banker in Ireland. He was also the person who slipped Celia Larkin the cheque for €40,000 to pay back that money she’d borrowed from the FF funds in Bertie’s constituency.

According to the Irish Times, Fingleton approved a loan of €40,000 to Ms Larkin on March 4th, 2008 without the standard criteria being fulfilled initially on the loan application. Ms Larkin did not provide documents normally required by customers borrowing such loans when she applied for the money.

He’s a deeply religious man. Fingers proudly boasts of his membership of Opus Dei, a shadowy Catholic brotherhood, and there you have it. One Opus Dei member has a quiet word with a fellow Opus Dei member who just happens to be the government minister responsible for negotiating the deal and everything is wrapped up nice and neatly.

See? This is independent Ireland. The Gaelic idyll.

Not only are our banks, our governing political party and the main church in this country all filthy, despicable and unprincipled organisations who have no qualms about sucking the taxpayer dry. It now seems there’s no difference between the three.

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PAYING FOR THE CELTIC TIGER

ECONOMIC TREASON – SIMPLE RECIPE

FINGERS FINGLETON SOLE BENEFICIARY OF €27 MILLION IRISH NATIONWIDE PENSION FUND

IRISH BANK GUARANTEES

Celia, Bertie and Fingers. The Plot Thickens


Categories
Economy

Paying For The Celtic Tiger

I have one house.

My car is 20 years old.

I have no holiday home.

I have never bought a property for resale at a profit.

I have never owned a rental property.

I had no SSIA.

I have never played the stock market.

I own no shares.

I have no designer clothes.

I owe nothing on my credit card.

And yet, according to our finance minister, I’m just as guilty of creating this financial crisis as anyone else.

I’m kicking myself.  It turns out I was part of the feeding frenzy, just like the politicians and their speculator friends, and I wish I had something to show for it.

Why didn’t I go crazy with the money since I’m paying for it anyway?

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Previously on Bock:

Economic Treason – Simple Recipe

Asset Management Agency – Ireland-s Bad Bank

Bludget 2009

Budget 2009 – My suggestions

Fingers Fingleton Sole Beneficiary of €27 Million Irish Nationwide Pension Fund

Bailing Out The Property Developers

Business Ideas for the New Great Depression

Sorry? What?

Irish Government Ministers

Denying the Economic Crisis

Anglo-Irish Bank’s Croke Park Corporate Box

The Anglo-Irish Ten, Hiding Behind Client Confidentiality

Irish Bank Guarantees

Sean Fitzpatrick Tells Parliamentary Committee To Fuck Off

Letter To Brian Goggin, Bank of Ireland CEO

Anglo-Irish Bank, Brian Lenihan and the 7-Billion-Euro Fraud

Irish Government Nationalises Anglo-Irish Bank

Categories
Banking Crime

Fingers Fingleton Finally Fired For Financially Fucking Fiscal Fund

At last, Fingers Fingleton is being kicked out on his miserable arse.

Pig.

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More Bock posts on Fingers Fingleton