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The Carroll saga - AIB giving joe soap the fingers

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    #32
    BendiBus
    Closed Accounts Posts: 2,075 ✭✭✭BendiBus


    mrsdewinter wrote: »
    After all, we can only recoup what we pay for the land & empty apartment blocks if prices rise to 2005-2006 levels

    Plus any revenue stream generated from actual loan repayments. Less the discount NAMA gets on the loan.

    So:

    A developer borrows 100 million.
    NAMA buys debt for 70 million.
    Developer repays 20 million before defaulting.
    Then NAMA only needs to raise 50 million from the sale of the asset to break even.
    i.e half the peak price

    I've no idea what the actual percentages will work out at, but is the logic of the above correct?


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    #33
    Imposter
    Registered Users Posts: 4,666 ✭✭✭Imposter


    BendiBus wrote: »
    Plus any revenue stream generated from actual loan repayments. Less the discount NAMA gets on the loan.

    So:

    A developer borrows 100 million.
    NAMA buys debt for 70 million.
    Developer repays 20 million before defaulting.
    Then NAMA only needs to raise 50 million from the sale of the asset to break even.
    i.e half the peak price

    I've no idea what the actual percentages will work out at, but is the logic of the above correct?
    Your maths is right but more likely what will happen is the following:
    A developer borrows 100 million.
    NAMA buys debt for 70 million => bank loses 30m
    Developer repays ~0m before defaulting => realistically they will probably default as soon as Nama are in control of the loan
    Then NAMA needs to raise 70 million => not likely for a long long time

    Then you have the risk that the bank needs to be able to handle the 30m loss too or they'll want more money.


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    #34
    AARRRGH
    Closed Accounts Posts: 12,382 ✭✭✭✭AARRRGH


    Imposter wrote: »
    Developer repays ~0m before defaulting => realistically they will probably default as soon as Nama are in control of the loan

    I agree. It's crazy.


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    #35
    BendiBus
    Closed Accounts Posts: 2,075 ✭✭✭BendiBus


    Imposter wrote: »
    realistically they will probably default as soon as Nama are in control of the loan

    This is the bit I have difficulty accepting. Is it based on anything other than conspiracy theory? It sounds like cynicism & bitterness rather than a reasoned conclusion.


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    #36
    The_Morrigan
    Moderators Posts: 9,368 ✭✭✭The_Morrigan


    Don't resurrect zombie threads!


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