Anglo Nationalised: what does this mean & what is the significance/consequence of it?

Re: Anglo Nationalised: what does this mean & what is the significance/consequence of

GeneralZod said:
Is this being done so that loans to Anglo from foreign banks can be repaid?
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It was interesting to hear Lenihan on Newstalk saying that the nationalisation was showing that Ireland is a country that pays it's debts.

If he is doing this to try & protect Irelands international reputation he is very misguided.
 
Re: Anglo Nationalised: what does this mean & what is the significance/consequence of

tyoung said:
An old fashioned bank run forced the government's hand.
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Do you really think it was a run on deposits? If so, what is the Central Bank (lender of last resort) for? Should we not just close it down and let Finance do its work? It'd save us a packet!

I don't believe the run on deposits story. I don't know what it is, but I know what I don't believe however many times it is said. Same as I didn't believe that Anglo was solvent or the guarantee a good idea. Saying don't make it so.

(Not having a pop at you tyoung, as this is the reason that is being given out - I am hoping either for a confirmation or some other explanations).
 
Re: Anglo Nationalised: what does this mean & what is the significance/consequence of

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Re: Anglo Nationalised: what does this mean & what is the significance/consequence of

Yoga,
Obviously I don't know either.
It might have been the cheapest option at least in the short run.
I take it that the 1.5B already promised wasn't going to be enough. Given that Anglo has, what, 100b in deposits, guaranteed by the state, and it's main assets are a bunch of illiquid property loans on which it has admitted that it's rolling up the interest, any sort of run on deposits would mean the government was staring into a black hole right now instead of( say) 6 months from now. It's clear the government don't want to call in Anglo loans and collapse that house of cards. Something might turn up!. It's pretty clear we're making it up as we go along.
 
Re: Anglo Nationalised: what does this mean & what is the significance/consequence of

Did BL say tonight on six one news that anglo had assets of 4b after liabilities or did I take it up wrong?
 
Re: Anglo Nationalised: what does this mean & what is the significance/consequence of

It was new Anglo-Irish chairman Donal O'Connor that made that highly dubious claim I believe. The same report mentioned that the market capitalisation before the shares were suspended was €166 million.
 
Re: Anglo Nationalised: what does this mean & what is the significance/consequence of

GeneralZod said:
It was new Anglo-Irish chairman Donal O'Connor that made that highly dubious claim I believe. The same report mentioned that the market capitalisation before the shares were suspended was €166 million.
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Big drop from €13 billion...
 
Re: Anglo Nationalised: what does this mean & what is the significance/consequence of

barryl said:
Did BL say tonight on six one news that anglo had assets of 4b after liabilities or did I take it up wrong?
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That is assuming it's assets aren't bad loans of course.
 
Re: Anglo Nationalised: what does this mean & what is the significance/consequence of

Based on what (informed ?) commentaters are saying, we won't know the answers to the questions posed in the thread title for some time, despite a variety of reports, studies and speculation.

The Minister has just appointed yet another bunch of Pontius Pilates to examine Anglo's books and listening to the Minister and God Help us, Gormley, on the wireless today, I have little confidence that we, the new owners of Anglo, have the information or the leadership to turn it around.

Speculate away folks, but at the end of the day its still speculation.
 
Re: Anglo Nationalised: what does this mean & what is the significance/consequence of

gravitygirl said:
That is assuming it's assets aren't bad loans of course.
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Indeed - have a look at: [broken link removed]
(page 9 gives the run-down)

Reading that, nothing seems wrong. everything looks wonderful! Pretax profits of €784m (Year ended 30th September)

But there's €72 billion in loans out to customers, whose ability to pay became the real question, especially when one sees the ghost estates around the country.

I suspect a few extremely wealthy clients, pulled their deposits/asset management portfolios when the government announced a 75% stake, so anglos ability to even look at writing off some bad debts started to be a doubt.

Incidentally, I own some anglo shares! I briefly caught a mention on TV, I think it was Shane Ross who gave a figure of the percentage of Anglo that is owned by small investors - anybody get the figure?
 
Re: Anglo Nationalised: what does this mean & what is the significance/consequence of

lets say hypothetically that what BL says turns out to be true,and anglo have assets of 4b over liabilities,will this (after costs) be divided between shareholders?
 
Re: Anglo Nationalised: what does this mean & what is the significance/consequence of

timod, he said that 80% of shares were owned by shareholders with shares worth less than 1k euro.

I think his logic (and his figures) may be a little fault.
- we know Quinn owns about 15%
- we know there are other insitutional investors
So I doubt the 80%

On the other hand, if you bought shares at 17 euro, and bought 77k euro of them, you would have had shares worth 1k when they were nationalised, so it may be that 80% of shareholders used to have a decent (small) pile of shares which became near worthless, which is now worthless.
 
Re: Anglo Nationalised: what does this mean & what is the significance/consequence of

yoganmahew said:
timod, he said that 80% of shares were owned by shareholders with shares worth less than 1k euro.

I think his logic (and his figures) may be a little fault.
- we know Quinn owns about 15%
- we know there are other insitutional investors
So I doubt the 80%

On the other hand, if you bought shares at 17 euro, and bought 77k euro of them, you would have had shares worth 1k when they were nationalised, so it may be that 80% of shareholders used to have a decent (small) pile of shares which became near worthless, which is now worthless.
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Nobody knows at this point if they are worthless or not
 
Re: Anglo Nationalised: what does this mean & what is the significance/consequence of

One question on the issue of compensation:

The Chairman of Anglo was saying yesterday that the assests exceed the liabilities by €4bn. Lenihan is saying the bank is solvent and is open for business as usual, that all it has is liquidity problems and he wanted to put clear water between it and the old management. Also, he is stating that it doesn't have a problem with non-performing loans and that it is generating enough income to cover it's liabilities (a highly dubious claim, given that it hasn't written down it's 'assets' to realistic levels yet).

So... if the bank is a going concern then it has a net book value of €4bn (in simplified terms). Either the compensation should be at this level for shareholders or the Chairman & Lenihan are being economical with the truth?
How else can they explain the gap between €4bn net asset value and the likely compensation of nil? Clearly the bank has failed and is on life support.
 
Re: Anglo Nationalised: what does this mean & what is the significance/consequence of

If there is compensation who pays it ,anglo or the government?
 
Re: Anglo Nationalised: what does this mean & what is the significance/consequence of

Duke of Marmalade said:
I thought one of BL's strangest comments was, when asked why not liquidate Anglo, because that would let debtors off light. First of all I doubt whether that is correct but what a skinny reason for putting the national finances on the line.
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Funnily enough that comment caught my attention over all the others.

Here is the comment:
The clear priority for us is to collect the debts and not to encourage debtors in an attitude that they don't have to pay their debts because in some sense the bank is being wound up. That is why that I am making it very clear that this bank is going to be run on proper commercial lines and loans have to be collected.
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This suggested to me that BL doesn't understand what he is doing.

It reminded me of the person who posted a question on AAM a few months ago asking whether they still have to repay their mortgage if the bank who issued it went bust; the question was laughed at by a number of posters.

Yet BL seems to believe that in some way, debtors get off lightly when a bank is wound up. If anything it is the opposite; the purchasers of loans will have little or no interest in maintaining a "relationship" and are likely to turn the screws much more readily to squeeze the debtors.
 
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