"Troubled Anglo Irish Bank to be split" by Shawn Pogatchnik, Associated Press | September 9, 2010
DUBLIN — Ireland plans to split its most troubled financial institution, Anglo Irish Bank, in two as part of wider efforts to reassure international lenders that the Irish are taking control of their debt crisis.
Finance Minister Brian Lenihan said yesterday that dividing Anglo — nationalized in early 2009 when it teetered on the edge of insolvency — into “good’’ and “bad’’ banks would represent the least costly outcome to Irish taxpayers. But opposition leaders and economic experts questioned whether the plan would change anything of substance....
They changed a couple names and shoved around some paper.
Ever here of a shell game?
The government took the action, in part, to relieve mounting criticism over the economy-crippling cost of keeping nationalized Anglo alive. It has already plowed nearly $29 billion into the specialist lender, and analysts warn that the total bill could top $44.53 billion — a fifth of Ireland’s gross domestic product.
From the start, Lenihan said Ireland could not let Anglo collapse because of the risk it would panic international investors into abandoning Ireland and toppling the nation’s other five locally run banks too.
He said the stakes were just as high now, noting that Anglo owes $91.6 billion to depositors, particularly in the United States, where Anglo-owned properties are lying derelict or bankrupt from New York to Florida.
“If we let those deposits go, we let Ireland go with it,’’ Lenihan said.
Also see: Irish Banker Bolts to U.S.
You let him go.
In 2008, after other Irish banks tipped off the government that Anglo was pleading behind the scenes for help paying its debts, Lenihan introduced a blanket government guarantee to insure international bondholders against losses at any Irish bank.
Did TAXPAYERS get a THANK YOU?
The government nationalized Anglo once the true scale of the bank’s bills — abetted by deceptive practices by bank directors — began to be exposed.
Then WHY should TAXPAYERS who had NOTHING TO DO WITH IT PAY the PRICE?
EU regulators this week agreed to extend that insurance to the end of 2010, which means any defaults on existing or new loans will be covered by taxpayers here at least until then....
Where is that notorious Irish anger I've heard so much about?
The “bad’’ bank would gradually dispose of Anglo’s largely dysfunctional book of loans to Ireland’s construction and property barons, many of whom went to the wall after Ireland’s property market burst in 2008.
Like they are going to buy that crap back.
An estimated $97.96 billion of those loans from five Irish banks — nearly half of them from Anglo alone — are being transferred at heavy discounts to Ireland’s state-run National Asset Management Agency or NAMA, a new vehicle for managing toxic property-based debts.
The COSTS keep GOING UP, don't they?
Critics described the planned split as a rebranding maneuver designed to keep Anglo depositors from withdrawing funds. They noted that both “new’’ banks would lose the Anglo name, but wouldn’t reduce the mammoth bill facing Ireland’s shellshocked population.
Oh, this is not about investors who already have the ins; this is about HIDING the COSTS of a BAILOUT from the Irish people!
