# A perspective on where we are



## Duke of Marmalade (7 Apr 2010)

In putting together this perspective I have made the heroic assumption that NAMA is paying fair value. My key observation is that AIB and BoI will not cost the taxpayer anything based on current thinking.

Take AIB. It had risk capital. It took the risks and it has blown most of that capital. The shareholders are the big big losers. But it hasn't blown ALL the capital. We want a functioning banking system so we want AIB to replenish its store of risk capital. Looks like we as taxpayers are going to have to be part of that process. But this is not a cost, it is capital. It will turn out to be a cost if we have another wave of economic or banking failure but hopefully it will turn out to be a good investment.

BoI is similar. But Anglo is a completely different kettle of fish. The 20Bn we as taxpayers are putting into Anglo has no capital element - it is simply filling the hole. 

In summary, this banking crisis looks like it will truly cost the taxpayer 20bn but all of that is at the door of Anglo (and a wee bit to Fingers).


----------



## DerKaiser (7 Apr 2010)

That's the way it looks to me.

AIB & BOI can probably repay any capitalisation.

Anglo and INBS will be lucky to get back half of what they loaned out.

This thing would not be anywhere near the catasrophe it is only for Anglo


----------

