Irish banks in a worse state than was thought

and I'll go to bed at noon

I think it's about time the Irish simply called it a day and all moved to America en masse. They could sell the land formerly known as Eire to pay off their debts. Everyone's a winner.

TomTom

You don't mention the key word - CORRUPTION. Just why did the Irish Finance Minister (later PM) have stakes in commercial property in Leeds funded by AIB on very generous terms ? Isn't Ireland simply another example of Crony Capitalism with a compliant political ready to do favours for old buddies in return for a bit of the action ?

Isn't that why the Irish Government assumed the exposure to prop up the banks so share options could be cashed and bonuses siphoned off ?

This is Grand Larceny, treasonable destruction of a sovereign state by looters who ran a giant LBO Scam on a scale impossible to undo without sovereign default to bring down German, French and UK banks

Ron Whitehand

Correction please.
The Banks knew about their problems. They just weren't telling anyone until The Inquisition arrived.

Cynic

How much is this little débacle going to cost us, seeing as we're signed up for the EUrobailout? The bill for the EU is well over £1000 per person as it is. Truly we'd be better off out.

DavidDP

And how much were the people who led the banks into the mire paid? Have they suffered in any way due to their poor management?

lola

Peston, late as usual. We had global banking sector analysis made available to us years ago that showed that nearly every bank globaly was bust, and hence kept well clear of banking stocks. From memory this research was carried out in about 2003.

Moving up to date, everyone knew that the last round of bailouts was just the start.

Why don't they just either let the bloody things go bust or force them into debt for equity swaps?

TGF UKIP

Now 10.30 pm and I can't help noting the deathly silence from the Coffee House hacks on the Loopy fiasco.

Don't want to further embarrass your sponsors, eh chaps?

In2minds

@and I'll go to bed at noon -

"I think it's about time the Irish simply called it a day and all moved to America en masse".

That's unfair, to America! And -

@TomTom - "You don't mention the key word - CORRUPTION"

That's because this is an EU affair so corruption is par for the course.

yank

and I'll go to bed at noon
March 31st, 2011 6:43pm

I think it's about time the Irish simply called it a day and all moved to America en masse.

.

No thanks, we've had quite enough of the micks historically, thank you very much. Good folk for the most part, but they took over urban area politics in the East and Midwest here, and made a hash of many of them. The city of my birth here, Detroit, is a wasteland largely because of the legacy of the "Irish mafia" that ruled it for decades and decades.

Now, we'll gladly take the English, so send over an equivalent number of those, and send the Irish to London. We'll take a few Scots as well, but none of the dang flatlanders. And a few Welsh if you must, although I could never make heads or tails of what they were saying. ;-)

Austin Barry

The last Irish government, led by the corpulent, bovine and moronic Brian Cowen, should be arrested for criminal negligence in signing a blank cheque, to be honoured by the listless Irish taxpayer, to pay off its chums the Irish casino-banks and their smirking loss-proof punters.

tankus

I did read somewhere that UK banks are exposed to the tune of around £350bn in Eire (mainly RBS)
A lot of those ghost estates and empty business premises is actually our collapsing collaterals on the loans.

Hence Cameron's bail out which went straight to the banks (hopefully ours)

Its not just Eire's problem but a real sphincter moment for our banking too
The banksters considered the Celtic tiger economy a safe punt.

TomTom

"@TomTom - "You don't mention the key word - CORRUPTION"

That's because this is an EU affair so corruption is par for the course."

Actually NOT. It is IRISH Corruption. It is the nature of Irish Politics that property developers and politicians golf with bankers and play the old "Amigo" game typical of agricultural politics.....the EU simply provided extra fuel with low interest rates to an already corrupt political system fro0zen in aspic since 1921.

Ireland did nothing more than out-British the British by becoming an even-laxer offshore island for financial transactions whilst ignoring the need to have a proper economic base.

Ireland is simply a microcosm of England

The Oncoming Storm

The sad thing is that Ireland had hit upon the recipe of strong sustainable growth, low taxes and investment in education, the Celtic Tiger was very real and still exists to an extent Ireland currently has a trade surplus largely made up from hi-tech exports. It's great misfortune was that Ahern and his gang of Bogmen got in and aided by unscrupulous bankers created a property bubble for the benefit of their developer paymasters. The crash was inevitable in the end.

Many people in Ireland are rightly angry over this but the thing is they voted Ahern in 3 times when the stories about his "interesting" financial affairs and associates and those of other senior members of Fianna Fail were well known. They were too busy revelling in their new net worth to care!

Perry

But surely . . . you never believed all the 'talking-up' guff did you??!!

2trueblue

The Oncoming Storm. Yes the Irish voted in Ahern thrice and the British voted in the Bliar/Brown lot thrice. Both parliaments undeniably corrupt, both presiding over bubbles. One of our problems with the Irish debt is that it involves RBS and commercial property. Added to that the Brown administration raced off to stiff us with the euro debt, which is not ours. Thanks again to all at Liebore.

TomTom

"A lot of those ghost estates and empty business premises is actually our collapsing collaterals on the loans."

Maybe, but ireland simply isn't big enough to absorb all that credit - Like Iceland it loaned it abroad. The collapsing collateral you speak of is in Spain, USA, UK and not necessarily in Ireland. Only the liabilities are in Ireland

justathought

Far better for Ireland to top up its EU bailout of e160 Bn now than later when the cupboard is empty! The new government can rightly blame the previous one.

So the private debt has now been nationalized and that has been financed by the EU. Everyone knows that the interest rate is unsustainable and so a debt restructuring of the debt is required down the line. As Jeremy Warner reports "a further breakthrough was made during last week’s European Council meeting. For the first time, EU leaders explicitly recognised the principle and inevitability of bank and sovereign debt default in the eurozone"

Meanwhile the UK does not have the luxury of going to Merkle & Sarkosey as lenders of last resort like the Irish have. PIMCO the worlds largest bond traders are net sellers of UK gilts. The UK public sector is 50% of the economy and payments are linked to high inflation rates while austerity measures will slow growth. Oil has hit $120 for Brent crude today and as the US economy grows it will push the price higher for the UK consumers.

The sustained high level of inflation means that interest rates must be raised soon by the BOE and ECB, further drag on growth and added pain for the UK consumers.

A UK sovereign debt crisis must be avoided at all costs and that means that at the very least there must be no slippage in the program to cut national debt.