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’Inside Ireland’s secret liquidity
A tidy scoop from RTE, who’ve uncovered key Irish government documents setting up Emergency Liquidity Assistance to banks:
…Mostly.
But it’s largely all there, focused on the critical period leading up to and after Ireland’s bailout,
Stress testing bailouts, not banks
It’s a little over a week until we get the results of Europe’s second round of stress tests.
Here on FT Alphaville we’ve often wondered what’s the point, given that every one seems to think that the assumptions used by the stress test administrators,
The face of Ireland’s new bank
Yes, Anglo Irish and Irish Nationwide have been stitched together to make… the Irish Bank Resolution Corporation. It will take about a decade to ‘resolve’ them.
Although we’re sure readers can think of a better name.
That was the Irish housing boom that was
A big hat-tip to Lorcan for this — the Irish 2011 census, which includes a nice chart of increases in housing stock, 2006-2011:
Over the period, Ireland’s housing stock expanded by 13.3 per cent,
Pensioners win their BoI burdensharing battle
Simply amazing.
After a very vocal campaign highlighting the unfairness of Bank of Ireland’s proposed exchange offer for subordinated debt — which included £75m worth of so-called Pibs that the Irish bank inhereited from Bristol &
Margins and money markets – oh my! [updated]
Meanwhile in Europe … Money markets are also moving.
Recent bidding patterns at the European Central Bank’s seven-day funding operation below:
€102bn on June 8. €136bn on June 15. And a whopping €187bn just on Wednesday.
UK pensioners 1 Irish bank 0
Irish taxpayers… 0?
For your perusal — a letter sent on Monday by Brown Rudnick to Bank of Ireland, challenging some (coercive) terms in its debt buyback.
Click image for the full letter:
Europe’s non-performing loan zones
Here’s PricewaterhouseCoopers’ (theoretical) non-performing loan (NPL) barometer:
If you’re a banking system, you want to be in Quadrant A — with a low percentage of NPLs that are relatively well-provisioned for,
Questions to which the answer is yes, AIB credit event edition
Has a credit event occurred with respect to Allied Irish Banks’ buyback of sub debt?
YES (says Isda)
Did this credit event occur on June 9, 2011?
YES
Is this anything more than a mild speed-bump in the bailing-in of Irish bank bondholders?
NO
Related link:
Will the last Irish bank to leave the market please turn out the lights
Quite a bombshell in Bank of Ireland’s latest, after-hours update on its bid to raise €4.35bn in capital to plug crisis losses:
If stockholders approve the proposals, the combination of the proceeds of the Rights Issue,
Why Irish burden-sharing is talking out its backside
First, it was Allied Irish Banks, and a capital structure which had egregiously flipped to favour equity over credit.
Now, as of Tuesday, it’s spread to Bank of Ireland:
The Bank intends shortly to launch a liability management exercise in respect of approximately €2.6 billion of its subordinated liabilities.
The Irish pain of RBS, charted
Ulster Bank Group accounts for 10% of the Group’s total gross customer loans or 9% of the Group’s Core gross customer loans. The impairment charge of £1,294 million for Q1 2011 was £135 million higher than the £1,159 million impairment charge for Q4 2010.
The O’Lloyds zombie, in context
Not too surprising to see Lloyds’ effort at kitchen-sinking Irish exposures in its Q1 results, with impairments up £500m more than guided to £1.14bn…
Even so, it’s a nice test case of how bad Irish property loan losses could conceivably get,
The ongoing mess in Allied Irish’s capital structure
So bad a mess even the hedging looks bust.
Quite apart from threatening to overturn the foundation-stone financial hierarchy of debt over equity…
There’s another way Allied Irish’s subordinated liabilities order might kill a market,
Allied Irish and a collapsing capital hierarchy
And the Allied Irish credit event query is — gone!
The question has been abruptly withdrawn. Looks like that’s going to set the stage for a bondholder case filed against the government order in question here,
Bad juju in Irish bank buildings
We’re unsure if this is exorcism, omen, or what.
According to the Irish Times:
The central bank is considering moving from its iconic headquarters in Dame Street, Dublin, to a single large building in the Docklands area that would accommodate 1,500 staff…
Say goodbye to Anglo Irish
Dubliners out and about on Thursday, might notice that Anglo Irish has disappeared. The nationalised bank has removed signage from its offices ahead of a planned rebranding.
Bank of Ireland – on the liquidity brink back in January, and err, April
From Bank of Ireland’s just-published annual report for 2010:
The Central Bank requires that banks have sufficient resources (cash inflows and marketable assets) to cover 100% of expected cash outflows in the 0 to 8 day time horizon and 90% of expected cash outflows in the 8 day to 30 day time horizon.
The IMF on the state of Europe’s banks
So now we know — the IMF sees European banks through yellow, green and red-coloured glasses:
Much, much more in the IMF’s just-released global financial stability report.
A trip through peripheral bank vortices
Equities and CDS sometimes have an odd relationship with reference to the same entity.
‘Cross current circularity’ (aka the vortex of fear) — the effect whereby equities and CDS price off each other in a crisis.
Reassurance on Irish bank data quality
FT Alphaville wishes to make a correction — on an Irish bank’s behalf. Via the Central Bank of Ireland:
The Central Bank has today updated the table on senior and subordinated debt published on 2 March 2011.
Stress-testing Ireland’s stress testers
BlackRock is really making a name for itself in financial crisis-related services — valuing the Fed’s Maiden Lane portfolio and undertaking the Irish banking stress tests too. But Ireland’s central bank also hired Boston Consulting Group (BCG) to supervise the stress testers,
Irish loan losses, forbearance, and a bad feeling
We’re still working our way through the Irish banks’ stress tests results. But there’s already a conundrum in assessing the severity of the tests.
Severity being the essential variable here — a severe test underlines Ireland’s vulnerability to restructuring and makes the case to outside actors that they need to provide backstop funding,
Ireland: does the fire sale start here?
You’ve already had the stress test results (more on those in a moment), here’s the Irish finance minister’s statement regarding what survives of Ireland’s banking system.
In short: a rump Bank of Ireland,
Viva, O’Vegas
As we wait for Ireland’s latest bank stress test results (due within half an hour at pixel time), a tidbit on methodology from the Irish Times:
BlackRock, the consultants hired by the Central Bank to verify the tests,
What lurks in Anglo Irish
What with being dead and all, Anglo Irish will probably not have a starring role in Ireland’s fifth attempt at recapitalising banks, due at 4.30pm (Dublin time) this Thursday.
That would be a shame.
Some intra-eurosystem inequality
The heart of Europe’s single currency union lies not in some grandiose parliamentary hall in Brussels, but in a little-known payment system platform with the unimpressive title of, “Target2″.
Just think of two eurozone banks.
Ireland — a double-size banking catastrophe
Commercial insurance payouts for global catastrophes in 2010 = $43bn.
Taxpayer insurance payouts for Irish banking catastrophes from 2008 onwards = $96bn.
A hat-tip to Credit Plumber for the comparison — which is obviously extremely unfair.