Anglo latest announcement

North_West_Art

Friday May 29 2009


"Anglo Irish Bank has announced massive pre-tax losses of €4.1bn for the six months to the end of March this year.
The bank - which is owned by the Irish taxpayer after being nationalised in January - says the losses are primarily driven by bad loan charges of €3.7bn.
Finance Minister Brian Lenihan has responded to the results by announcing that the Government has agreed to inject up to €4bn of taxpayers' money into the institution, subject to EU approval.
Mr Lenihan says the results are extremely disappointing, but Anglo's full and frank disclosure of the problems it faces is an important step."

Mr. Lenihan also used the word systemic when refering to the implications of this latest news. How serious is this news and what will this mean to the average person?

paddyboy23

if anyone thinks that brian lenihan is going to let down his dads mates in anglo your mistaken,this report into children abuse has taken the heat of them until today when brian rang his banker buds and said hows 4 billion boys will that keep you ticking over for awhile its a joke they took kids xmas money and to turn around and give anglo 4 billion this is going to far

BOHSBOHS

...including 308 million euros in loans to the 10 golden circle chaps

written off ....which the taxpaper will pay for :eek:

ardmacha

..including 308 million euros in loans to the 10 golden circle chaps

Now this bit I didn't understand. Fair enough the shares are worthless and so the security for the loan is gone, but do these gentlemen not have any money otherwise?

thebman

The only guarantee on the loan was the shares themselves. Presumably when Anglo was nationalised, they ceased to exist.

Anglo's story becomes a bigger joke each day its let keep its doors open. I'd laugh but the taxpayers for generations will be paying for this joke which kind of kills whatever humor was in the joke making Anglo even worthless as a joke.

cyclopath2001

thebman wrote: »

The only guarantee on the loan was the shares themselves. Presumably when Anglo was nationalised, they ceased to exist.

If a person buys a house and defaults, they have to sell the house and still make up the loan balance after the house proceeds have been paid off against the loan.

Unless the Golden Circle guys used limited companies to buy the Anglo shares, they'd be personally liable notwithstanding that their collateral is worthless? Even then, the companies used to host the deals might not be valid trading companies & the directors might be made liable?

They took a risk in the hope of making a big killing, they should pay back the loans. Unless, that is, they only 'fair-weather' capitalists, in it for the profits but not the losses.

More needs to be known about how the transaction was stuctured.

nesf

cyclopath2001 wrote: »

If a person buys a house and defaults, they have to sell the house and still make up the loan balance after the house proceeds have been paid off against the loan.

Unless the Golden Circle guys used limited companies to buy the Anglo shares, they'd be personally liable notwithstanding that their collateral is worthless? Even then, the companies used to host the deals might not be valid trading companies & the directors might be made liable?

They took a risk in the hope of making a big killing, they should pay back the loans. Unless, that is, they only 'fair-weather' capitalists, in it for the profits but not the losses.

More needs to be known about how the transaction was stuctured.

Has it been confirmed that they're being left off with no attempt of recovering money from them?

cyclopath2001

nesf wrote: »

Has it been confirmed that they're being left off with no attempt of recovering money from them?

According to the Irish Times:

Anglo wrote off €308 million from “golden circle” loans made last year to 10 clients to fund their purchase of a big stake in the bank in an effort to prevent a further collapse in its share price. It wrote off €31 million on loans to former directors but declined to name them.

I wonder if the guys' ('Golden Circle'? ) credit cards have been withdrawn? Their credit rating must surely take a hammering. They might have trouble getting a car loan if they've stiffed a bank for a million or ten.

nesf

cyclopath2001 wrote: »

According to the Irish Times:


I wonder if the guys' ('Golden Circle'? ) credit cards have been withdrawn? Their credit rating must surely take a hammering. They might have trouble getting a car loan if they've stiffed a bank for a million or ten.

Is that the whole loan though? They might have just written off a portion of it as unrecoverable and be pursuing the Golden Circle over the remainder?

P. Breathnach

nesf wrote: »

Has it been confirmed that they're being left off with no attempt of recovering money from them?

It has been reported (but how reliable the reports are is unknowable to members of the hoi-polloi) that the loans to the golden circle were secured only on the shares themselves, without recourse.

I would venture a lay opinion that if such a deal was made it was self-evidently done for an illegal purpose (manipulation of the market using the bank's own funds) and the protection of the borrowers might be removed by the courts.

nesf

P. Breathnach wrote: »

It has been reported (but how reliable the reports are is unknowable to members of the hoi-polloi) that the loans to the golden circle were secured only on the shares themselves, without recourse.

I would venture a lay opinion that if such a deal was made it was self-evidently done for an illegal purpose (manipulation of the market using the bank's own funds) and the protection of the borrowers might be removed by the courts.

I would concur in that it's an extremely dubious way to do business and warrants investigation.

dingding

How has no one gone to jail for the whole thing.

It was an attempt to manipulate the share price using the banks funds.

Also the bank must have traded recklessly to loose that ammount of money.

It has also come out that some of the properties were provided as collateral to several banks.

Every transaction should be investigated and the bankers should be made pay.

P. Breathnach

dingding wrote: »

How has no one gone to jail for the whole thing.

It was an attempt to manipulate the share price using the banks funds.

It's early days yet. The wheels of justice turn slowly, especially in matters of this nature.

Also the bank must have traded recklessly to loose that ammount of money.

Exceedingly difficult to prove.

It has also come out that some of the properties were provided as collateral to several banks.

If that happened, it might be the fault of those offering the collateral and there might have been negligence by those charged with the legal processes.

Every transaction should be investigated and the bankers should be made pay.

Are you not getting a bit ahead of yourself there? Whether the bankers, or anybody else, should be made pay should be decided after any investigation.

dingding

I meant the bankers that were guilty of misconduct should be made pay.

I am sure there were many property and investment transactions that there is no problem with and that all procedures were followed.

As banks particularly AIB made bad decisions over the years, they were bailed out by the government.

I was reading in todays paper that the current bailout of Anglo, will cost each family €2,500 thats over €200 that the golden circle deal cost each family.

dresden8

Deleted

dresden8

If only this was America. The FBI would be reaming these guys @rseholes out looking for evidence. First one to cough up would get off, everybody else gets 30 years playing doctors and nurses with Bubba.

Dream on.

thebman

P. Breathnach wrote: »

I would venture a lay opinion that if such a deal was made it was self-evidently done for an illegal purpose (manipulation of the market using the bank's own funds) and the protection of the borrowers might be removed by the courts.

Wouldn't they have to be taken to court by the state for that to happen?

P. Breathnach

thebman wrote: »

Wouldn't they have to be taken to court by the state for that to happen?

Yes, they would have to be taken to court. Strictly speaking, I think the plaintiff would be Anglo-Irish Bank, and the fact that it is now state-owned doesn't really come into it.

AlekSmart

If only this was America. The FBI would be reaming these guys @rseholes out looking for evidence. First one to cough up would get off, everybody else gets 30 years playing doctors and nurses with Bubba.

Dream on.

It should`nt be forgotten that on the day the world media was publishing pictures of Bernie Madoff being led from his Manhattan appartment in chains and leg-irons our native papers publiched some pictures of a relaxed beaming Seanie Fitzpatrick tee`ing off at Greystones G.C.....Horses for courses...?

nesf

AlekSmart wrote: »

It should`nt be forgotten that on the day the world media was publishing pictures of Bernie Madoff being led from his Manhattan appartment in chains and leg-irons our native papers publiched some pictures of a relaxed beaming Seanie Fitzpatrick tee`ing off at Greystones G.C.....Horses for courses...?

Eh did Fitzpatrick run a giant Ponzi scheme while I wasn't paying attention? Compare like with like, do you see any of the CEOs of the American banks being led around in leg-irons?

johnnyskeleton

I already viewed Anglo as an €80bn drag on public finances, so this latest €4bn doesn't phase me. My concern is how much it will ultimately get back for us, and I think we will at best see half of that €80bn. The rest will turn out to be spent on directors loans, developers loans and other risky decisions, which it appears are not recoverable.

There are a lot of people who have to go to jail over this, some politicians included. If they do not go to jail, no serious international investor will think twice about Ireland, as we will have proved ourselves to be as corrupt as they come. No one will invest in a country with such a level of instability.

johnnyskeleton

nesf wrote: »

Eh did Fitzpatrick run a giant Ponzi scheme while I wasn't paying attention? Compare like with like, do you see any of the CEOs of the American banks being led around in leg-irons?

If you want to compare like with like, what about the Irish citizens who have been jailed for failing to pay their debts? They usually owe a few thousand euro and don't turn up in court out of fear, drug/alcohol addiction etc, but what's fitzpatricks excuse? He owes over €100m but there is little or no chance of him paying it back. Does he go to jail for that? is he declared bankrupt?

johnnyskeleton

P. Breathnach wrote: »

It has been reported (but how reliable the reports are is unknowable to members of the hoi-polloi) that the loans to the golden circle were secured only on the shares themselves, without recourse.

I would venture a lay opinion that if such a deal was made it was self-evidently done for an illegal purpose (manipulation of the market using the bank's own funds) and the protection of the borrowers might be removed by the courts.

Unfortunately, an illegal contract is only unenforceable as against the person you are seeking to enforce it against. So the illegality of a contract will not act to make the contract enforceable as against the golden circle.

We are in unknown territory when it comes to outrageously illegal contracts which have since been taken over by the state. If anything, the biggest offence was the nationalisation of Anglo and that act far outweighs any other criminal act committed by the directors, shareholders and customers of Anglo. The real culprits in this are undoubtedly our politicians as if it wasn't for their intervention the golden circle would no doubt get what's coming to them.

nesf

johnnyskeleton wrote: »

If you want to compare like with like, what about the Irish citizens who have been jailed for failing to pay their debts? They usually owe a few thousand euro and don't turn up in court out of fear, drug/alcohol addiction etc, but what's fitzpatricks excuse? He owes over €100m but there is little or no chance of him paying it back. Does he go to jail for that? is he declared bankrupt?

I know, but such cases aren't like something like running a Ponzi scheme that results in immediate legal action. It'll take months, if not years, to untangle the mess that is Anglo.

johnnyskeleton

nesf wrote: »

I know, but such cases aren't like something like running a Ponzi scheme that results in immediate legal action. It'll take months, if not years, to untangle the mess that is Anglo.

Given full access to the accounts, CAB could have it all stiched up in a matter of months. It's literally a case of looking at each individual loan and deciding whether it was made for a dishonest purpose or not. Each person who borrowed on such terms can then be investigated, and while it might keep going through the courts for several years, there is no reason, other than the politicial sheltering of Anglo, that it all can't be unraveled right now.

cyclopath2001

johnnyskeleton wrote: »

there is no reason, other than the politicial sheltering of Anglo, that it all can't be unraveled right now.

And its cronies. Why have bankruptcy prceedings not been taken against the 'Golden Circle' who have defaulted on their loans?

johnnyskeleton

cyclopath2001 wrote: »

And its cronies. Why have bankruptcy prceedings not been taken against the 'Golden Circle' who have defaulted on their loans?

I'm not sure that they can bring bankruptcy proceedings if the contract debt is unenforceable.

ejmaztec

They will probably bring action against some of these people, but it will be like the tribunals, dragging on for years and racking up more costs before fading into oblivion.

I sincerely hope that whatever assets these folks possess have been frozen.

SEPT 23 1989

this will be the religous orders abuse scandal of the future how will we explain this scam to our children and grandchildren we really are bloody idiots

cyclopath2001

johnnyskeleton wrote: »

I'm not sure that they can bring bankruptcy proceedings if the contract debt is unenforceable.

To know that we'd need to know the details of the contract. We don't even know if the loans were made directly to actual people or to some shelf-company, registered and controlled in God-knows where.

This is sounds like another money-go-round similar to the one with the 8bn transitting ILP.

Why did the 'golden circle' boyos get involved? There must have been some promise of profit/gain? And those guys are not stupid, they must have known before many of us that Anglo was one very naughty bank.

P. Breathnach

cyclopath2001 wrote: »

... Why did the 'golden circle' boyos get involved? There must have been some promise of profit/gain? And those guys are not stupid, they must have known before many of us that Anglo was one very naughty bank.

If what is generally reported is true, they were made an offer that no greedy person could refuse: a loan to enable them purchase about 1% of a bank. If the shares went up, they made a profit; if the shares fell, they suffered no loss.

Knowing that "Anglo was one very naughty bank" was no deterrent. Money has no sense of morality.

Mr.Micro

cyclopath2001 wrote: »

To know that we'd need to know the details of the contract. We don't even know if the loans were made directly to actual people or to some shelf-company, registered and controlled in God-knows where.

This is sounds like another money-go-round similar to the one with the 8bn transitting ILP.

Why did the 'golden circle' boyos get involved? There must have been some promise of profit/gain? And those guys are not stupid, they must have known before many of us that Anglo was one very naughty bank.

I suspect there is /was massive fraud involving this golden circle and the bank which is political dynamite that would reach far and wide IMO. Lenihan is determined to save the Anglo no matter what price. It defies logic financial or just plain, so there has to be other reasons. It always makes me laugh now when I hear regulated by the financial regulator and the AIB advert, be with AIB, ah sure we are since the taxpayer owns a massive chunk of it .

cyclopath2001

Mr.Micro wrote: »

Lenihan is determined to save the Anglo no matter what price. It defies logic financial or just plain,

It would be interesting to know of the government is paying rent on properties, which are in the 'bad loan' (or not-very-well-behaved loan) book...or to companies which owe money to Anglo.

ejmaztec

SEPT 23 1989 wrote: »

this will be the religous orders abuse scandal of the future how will we explain this scam to our children and grandchildren we really are bloody idiots

Hopefully by telling them that there used to be a party called Fianna Fail that got disbanded due to lack of support, and take it from there.

AlekSmart

Eh did Fitzpatrick run a giant Ponzi scheme while I wasn't paying attention? Compare like with like, do you see any of the CEOs of the American banks being led around in leg-irons?

It`s not really germane as whether Seanie Fitz "ran" a Ponzi scheme or not.

His all too flamboyant actions and the equally obvious benefits that he reaped from this flamboyance,which we now know know to be based on highly dubious and most likely illegal stewardship of the Bank,served to encourage other less pushy movers and shakers to venture forth on the same track.

It may not be like for like in strict comparitive terms,but it`s pretty damn close in my book :rolleyes:

Seth Brundle

NAMA will use compulsory purchase

By Dearbhail McDonald

Tuesday June 02 2009

COMPULSORY Purchase Orders (CPOs) will be deployed by the National Assets Management Agency (NAMA) to quell legal challenges by developers and acquire their lands.

The Government will seek Dail approval for dedicated CPOs to overcome planned legal actions by developers who fear they will be subjected to predatory and aggressive targeting of their assets by Ireland's 'bad bank'.

CPOs are an existing power used by the State to acquire land in private ownership and the mandatory process is used by local authorities to acquire lands for road construction or for other public purposes.

But developers fear that lands compulsorily acquired by the NAMA at a discount could result in the Government or other developers to whom the land is sold reaping significant profits at their expense.

Plans to deploy CPOs are under way at the Office of the Attorney General, which is setting out sweeping powers for the new agency, including mandatory powers to acquire assets.

A number of legal firms have been commissioned to protect developers' interests ahead of the new legislation and the Construction Industry Federation has set up a "war chest" to fight any legal challenges it deems necessary.

Though many of the country's builders are resigned to the establishment of the new agency, they are concerned that the State will fuel large profits to any new owners of lands which are sold by the NAMA without compensating them for any losses.

Valuers will play a key role in discounting the sales of troubled assets and the NAMA, which will send teams of experts into banks to perform legal and financial due diligence on toxic loans, will face a range of legal difficulties as many assets are multi-banked and the vast majority of loans are "bespoke" and do not have uniform legal documentation.

Last week, the CPO-style procedures were confirmed by Brendan McDonagh, interim managing director of the NAMA, who signalled that government approval will be sought for a range of powers including, potentially, CPOs.

Since the announcement of the decision to establish the NAMA, a steering group comprising the National Treasury Management Agency, the Department of Finance and the Office of the Attorney General has been meeting twice a week to consider a range of issues, including CPOs, which will be included in the draft NAMA bill.

- Dearbhail McDonald

http://www.independent.ie/business/irish/nama-will-use-compulsory-purchase-1757814.html

I wonder how much compensation we will end up paying the developers who defaulted on their loans!