# Current consensus on the safety of Irish banks



## dockingtrade (11 Feb 2012)

over the last few years the was alot of concern about the the safety of deposits in irish banks and in state savings. Many here had moved cas h out or said they wouldnt have a cent in an Irish bank, im just wondering has that changed for some contributors.


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## pudds (11 Feb 2012)

dockingtrade said:


> over the last few years the was alot of concern about the the safety of deposits in irish banks and in state savings. Many here had moved cas h out or said they wouldnt have a cent in an Irish bank, im just wondering has that changed for some contributors.



I just read somewhere today by an article in the newspaper  by someone in usa who has a *great *track record of predicting economic disasters and the us government takes notice of..............says  that Ireland is facing doom this year over the whether we should develop the possible oil field in laois or is it leitrim.

He sums it up by saying that basically we have no choice as the country is being *run by the Banks* and I can't argue with that.  

So on that basis I guess the safest place to put your money *is* in the Irish banks.


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## Lightning (12 Feb 2012)

To answer your question one needs to look at what might be about to happen Greece. If Greece can leave the Euro and devalue then any periphery country can.  

The risk is no longer Irish banks per se, the risk a reigniting of the fear of a euro exit. The prospect has not gone away.


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## Knuttell (13 Feb 2012)

dockingtrade said:


> Many here had moved cash out or said they wouldnt have a cent in an Irish bank, im just wondering has that changed for some contributors.



Nothing has changed,the Greek can being kicked down the road is getting pretty tedious now,it really is just postponing the inevitable.

Money,what little I have is still in Belgium... considering investing the lot in well priced US blue chip where I can see value but wont leave a cent beyond what we need for week to week expenses in an Irish Bank,you just couldn't trust them,even when this all recovers and it will in a few years time,I will never leave a lump sum in an Irish Bank ever again,not after the damage they have inflicted on the State and her people.


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## kdoc (14 Feb 2012)

Many people SAID they moved, or will move, their cash out of Ireland. A well known psychological phenomenon is that what people say is often at variance with what they do.


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## 44brendan (14 Feb 2012)

Knuttell said:


> I will never leave a lump sum in an Irish Bank ever again,not after the damage they have inflicted on the State and her people.


 
If we all took that approach it would drive the economy further into the mire. Banks are Banks. Whether Irish or other, they all made mistakes. The foreign banks operating in Ireland operated as recklessy as their Irish counterparts. While holding no candle for the Banking sector, there is no logic to the approach of "punishing banks" by holding your money abroad. 
If you have sufficient resurces it does make sense to hedge your risk by diversfying your assets. However, most of us are fully dependent on this economy for our own livlihoods and that of our children and I for one am quite satisfied to keep my meagre resources in the country and hope that in some small measure every Euro left here will be 1 less that we have to borrow externally.


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## Knuttell (14 Feb 2012)

44brendan said:


> If we all took that approach it would drive the economy further into the mire. Banks are Banks. Whether Irish or other, they all made mistakes. The foreign banks operating in Ireland operated as recklessy as their Irish counterparts. While holding no candle for the Banking sector, there is no logic to the approach of "punishing banks" by holding your money abroad.



Its got nothing to do with punishing the banks,its that the Irish banks are not competent or trustworthy,it really is that simple.

You need any proof of that then you have been asleep for the last five years while they ran _"*the Economy we all so reliant on for our own livlihoods and that of our children"*_ off a cliff at mach 10.



> Banks are Banks. Whether Irish or other, they all made mistakes. The foreign banks operating in Ireland operated as recklessy as their Irish counterparts.



That really brought me back to the dark old clowen days,

_*"twarnt us what done it,twas Lehman brothers"
*_
You know what I didn't buy that specious reasoning then and I am not buying it now,our banks behaved in a reckless,incompetent,greedy fashion and they have learned nothing from this fiasco except that they can at some stage in the future do it all over again...and get away with it...but it wont be with my money.

Brendan,do you work for a Bank?


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## cork (15 Feb 2012)

44brendan said:


> The foreign banks operating in Ireland operated as recklessy as their Irish counterparts.




Well established UK banks were pretty badly hit.

It was not just Irish banks.

It wasn't just a failure of regulation - The problem was not just confined to Ireland.

Banks had gone reckless to earn more profits.


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## cork (15 Feb 2012)

Knuttell said:


> _*"twarnt us what done it,twas Lehman brothers"
> *_





Was the "soft landing" not predicted by the ESRI?



Politicians were been fed advice from the public servants.

Remember the 07 election manifestos?


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## callybags (15 Feb 2012)

The original question was about the safety of Irish banks.

Not 1 Cent has been lost by depositors despite all that's gone on.... and that is good enough for me.

I'm no expert, but with all the money that has gone into Irish banks, I would have thought they are now the safest around.


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## 44brendan (15 Feb 2012)

The main topic of the post concerns the current safety of deposits in Irish banks. Government guarantee scheme (effectively underwritten by the ECB) guarantees deposits up to €100K in the main financial institutions in the country. Amounts above this level are covered to June 12 by an ELG guarantee in a limited number of institutions. 
The past or current management of the banks is therefore irrelevant to the safety of the depositors funds. 
The "unknown" factor is what will happen if the Euro disintegrates or Ireland exits from the currency. This is a risk that cannot be accurately assessed, as the consequences are unknown.
Past records of reckless trading in Banks or even the potential for further reckless trading (limited by increase in supervision) will not affect the quality of the underlying funds guarantee.


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## kdoc (16 Feb 2012)

callybags said:


> The original question was about the safety of Irish banks.
> 
> Not 1 Cent has been lost by depositors despite all that's gone on.... and that is good enough for me.
> 
> ...


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## Chris (17 Feb 2012)

dockingtrade said:


> over the last few years the was alot of concern about the the safety of deposits in irish banks and in state savings. Many here had moved cas h out or said they wouldnt have a cent in an Irish bank, im just wondering has that changed for some contributors.


I agree with Knuttell and CiaranT on this, the basic answer is no, they are no safer than they were a couple of years ago. They are still 100% reliant on the ECB and an absurd guarantee by the Irish state. That does not make them safe, that makes them extremely risky.



kdoc said:


> Many people SAID they moved, or will move, their cash out of Ireland. A well known psychological phenomenon is that what people say is often at variance with what they do.


I think there is a thread on AAM that shows how much deposits left the country which proves your assumption wrong. If deposits had not fled the country then there would not have been a need to provide unlimited liquidity by the ECB.



callybags said:


> The original question was about the safety of Irish banks.
> 
> Not 1 Cent has been lost by depositors despite all that's gone on.... and that is good enough for me.
> 
> I'm no expert, but with all the money that has gone into Irish banks, I would have thought they are now the safest around.


Just because people haven't lost money yet does not mean that they won't lose any money. The risks were always two-fold, (1) bank goes bankrupt and Irish state does not have the money to stand up to the guarantee and (2) Ireland leaves the Euro or the Euro breaks up. Neither of these risks have gone away. And if Irish banks were the safest around, then why have their credit ratings not improved and why have deposits not flooded into these "safe" banks?


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## putsch (17 Feb 2012)

Chris said:


> I agree with Knuttell and CiaranT on this, the basic answer is no, they are no safer than they were a couple of years ago. They are still 100% reliant on the ECB and an absurd guarantee by the Irish state. That does not make them safe, that makes them extremely risky.
> 
> I think there is a thread on AAM that shows how much deposits left the country which proves your assumption wrong. If deposits had not fled the country then there would not have been a need to provide unlimited liquidity by the ECB.



Just on the point of who moved money.....the big movers in terms of scale were the corporations especially financial service companies who have strict guidelines in relation to credit ratings as to where they have to place their funds for solvency purposes. So when Moodys drops the Irish credit ratings billions leave the Banks. The people making these decisions are the credit ratings agencies.
Individuals' savings even if they are 100K or multiples of have little or no impact on the banks. It the corporates what done it!


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## kdoc (18 Feb 2012)

Chris said:


> I think there is a thread on AAM that shows how much deposits left the country which proves your assumption wrong. If deposits had not fled the country then there would not have been a need to provide unlimited liquidity by the ECB



Corporations and some people moved their money. I don't believe the majority of ordinary people moved their deposits.


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## kdoc (18 Feb 2012)

And on another thread it was reported that Alan McQuaid of Bloxham kept all his money in Irish Banks. I'm sure he's happy with his returns.


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## Centaur (23 Feb 2012)

*... deposit rate differences ..*

I'd like to be convinced of the safety of our banks but I've one main nagging worry.

Why are the likes of KBC prepared to pay a much higher rate in Ireland than they do in their home country?  I know they are probably matching lending risk but they must view that risk to be substantial.


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## kdoc (27 Feb 2012)

We are a number of years into the financial crisis, and despite the closure of some Irish banks and the merging of others, no depositor has lost anything. The doomsayers are very disappointment.


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