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Nama to leave out Anglo’s US loans


DCon

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Anglo Irish Bank is set to exclude almost all of its €10 billion US loan book from its transfer of assets to the National Asset Management Agency (Nama), in a move that will pave the way for a quick sale of these loans to another institution.

The nationalised bank - which ramped up its US lending activities from €1 billion in 2004 to €10 billion this year - has received approaches from a number of potential buyers of the loan book, which consists primarily of commercial property investment loans in New York, Chicago and Boston.

The potential buyers include US and Canadian banks and private equity groups. Interested bidders may have approached some former Anglo employees to advise them on the details of Anglo’s American loan portfolio.

Figures released by the Department of Finance last week revealed that, of the €77 billion book value of loans to be acquired by Nama, just over €2 billion will relate to US-based loans.

According to the department, Anglo’s US loan portfolio consists of €1.4 billion in land and development lending and €9 billion in so called ‘‘associated loans’’.
Nama to leave out Anglo?s US loans | The Post
 

cyberianpan

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Why is this segment of the Anglo portfolio to be excluded from the NAMA?

This was announced ages back

The reason is there's a large private US market - it can purchase these loans - no pricing problem

In Ireland we have systemic failure.... BOI could hardly buy Anglo's Irish loans?

cYp
 

powderfinger

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Could there be performing loans housed in the Anglo US portfolio which are producing a revenue stream?
Are there any loans in the Anglo US book that have been used as cross collateral for other Anglo lending that is NAMA bound?
For example.If Developer X has a global portfolio of properties and included in that basket there is both Irish and US elements financed by Anglo,would it not be better to put the US loans into Nama as a hedge against more critically impaired Irish lendings?
 

Cassandra Syndrome

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Why is this segment of the Anglo portfolio to be excluded from the NAMA?
Probably because they are straight forward loans based on 1 mortgage for the same property and there is nothing illegal in them.
 

PaddyJoe McGillycuddy

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Anglo rebuffs ?1bn offers for its ?10bn US property loans
I enjoyed the line that
Anglo is already operating under a suspension of normal capital rules from the Financial Regulator until April.
I'd say that Anglo always operated under a suspension of normal rules from the Financial Regulator!
 

MsAnneThrope

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Is David Fitzpatrick (Seanie's son) still working in the New York Anglo office does anyone know? He was still there earlier this year as a senior executive, and I haven't heard of him leaving since.
 

Cassandra Syndrome

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If they can flog this stuff quickly it will help wind Anglo up. I presume if they as sell off 10bln of assets and NAMA takes 28bln there will be little left.

In Fractional Reserve banking the deposit to cash ratio should be 10:1. So if you deposit 100 Euro in a bank they hold 10 Euro of it in cash and lend the other 90 Euro out.

Looking at Anglo Irish Bank's balance sheet at the end of March their Deposit to cash ratio is 130:1. Their Loan book to deposits which should be 90% is 195%.

Their loan book is 66.6 Billion (appropriate number!). So post NAMA they would have 28 Billion of these "assets"

I wouldn't indignify the term insolvent to use it to describe them.

http://www.angloirishbank.com/Investors/Reports/Interim_Reports_2009/Interim_Report_2009.pdf
 

cyberianpan

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In Fractional Reserve banking the deposit to cash ratio should be 10:1. So if you deposit 100 Euro in a bank they hold 10 Euro of it in cash and lend the other 90 Euro out.
Those ratios are not germane, as they are a gross over simplification, and furthermore leave out the concept of Risk Capital entirely, Tier 1 and Tier 2 risk capital are more important - see Capital Requirements - but not under Basle/CAD/CRD local regulators have substantial discretion.

Also see this if you must.


cYp
 

Cassandra Syndrome

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Those ratios are not germane, as they are a gross over simplification, and furthermore leave out the concept of Risk Capital entirely, Tier 1 and Tier 2 risk capital are more important - see Capital Requirements - but not under Basle/CAD/CRD local regulators have substantial discretion.

Also see this if you must.


cYp
Over simplified? Silly me. Anglo Irish is in great shape. The Global Financial system is as sound as a pound. Everything is hunky dory. Yes sir.

Tier 1 capital ratios deal with Banks "Asset" which its loanbook makes up the majority of this. Now how much is Anglo Irish's 66 Billion of a Loan book based on a notional value of property?

What is the real value of these "assets"?

Did you ever hear that Cash is King?
 

Cassandra Syndrome

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Those ratios are not germane, as they are a gross over simplification, and furthermore leave out the concept of Risk Capital entirely, Tier 1 and Tier 2 risk capital are more important - see Capital Requirements - but not under Basle/CAD/CRD local regulators have substantial discretion.

Also see this if you must.


cYp
Tier 1 Ratios are more important, really?

While some banks may look healthy under normal Tier 1 and leverage targets, critics claim these measures can be highly misleading since they fail to discriminate between high-risk and low-risk uses of leverage. The system failed to pick up the danger signals before the financial crisis. The supposedly moderate leverage of US banks in 2007 proved to be a spectacularly useless indicator.
Then again this is a report in the Daily Telegraph and that is mainstream media. Oops thats right you are a fan of mainstream media.

Yeah there is nothing wrong with the concept of Fractional Reserve Banking now is there? Just as long as there isn't more than a 5% flight of capital around the world at the same time. And them fools who use that "House of Cards" metaphor....

Most global banks are still unsafe, warns S&P - Telegraph
 

cyberianpan

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Tier 1 Ratios are more important, really?



Then again this is a report in the Daily Telegraph and that is mainstream media. Oops thats right you are a fan of mainstream media.

Yeah there is nothing wrong with the concept of Fractional Reserve Banking now is there? Just as long as there isn't more than a 5% flight of capital around the world at the same time. And them fools who use that "House of Cards" metaphor....

Most global banks are still unsafe, warns S&P - Telegraph

Your insane gibberings have no serious fans here

I never said Tier 1 or 2 Risk Capital ratios.... just pointed out that Tier 1 or 2 Risk Capital is far more important than deposit strength

And also referred to the fact that it is up to local regulators to set risk adjusted ratios. A gross ratio... ones-size-fits-all ... belongs more to numerology / Kaballah than financial markets

cYp
 

Cassandra Syndrome

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Your insane gibberings have no serious fans here

I never said Tier 1 or 2 Risk Capital ratios.... just pointed out that Tier 1 or 2 Risk Capital is far more important than deposit strength

And also referred to the fact that it is up to local regulators to set risk adjusted ratios. A gross ratio... ones-size-fits-all ... belongs more to numerology / Kaballah than financial markets

cYp
Insane gibberings? It may look great that a Bank may have a tier capital of 10 Billion Euro. But if it has crazy loans out there that are properly analysed with real mark to market values, the ratio for the vast majority of Banks is less than 4%. The FDIC is under obligation to receive a bank if it goes under 2%, but that is using mark to market values from over a year ago and we all know where property has gone from then.

The FDIC is broke, by the way and says that there are over 400 banks in "trouble" using the old measurement. The whole lot of them are in trouble if you ask me.

I suppose an analogy of Tier 1 Capital V Tier 1 Capital Ratio is the old saying "turnover is vanity, Profit is sanity"

http://stlouisfed.org/col/director/materials/alco_capitaladequacy_ratios.htm
 

Cassandra Syndrome

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Your insane gibberings have no serious fans here
By the way, I am not here to win fans or to satisfy some sort of Narcissistic supply need. I'm here to warn people.
 

CookieMonster

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By the way, I am not here to win fans or to satisfy some sort of Narcissistic supply need. I'm here to warn people.
And yet you succeed only in derailing threads and annoying people.
 

Cassandra Syndrome

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And yet you succeed only in derailing threads and annoying people.

In derailing threads do you mean debating? I thought this was a political forum.

Annoying people? Who exactly? The same people who refer to other posters, say for example the anti NAMA people, as idiots, lunatics etc.?

"In times of universal deceit, telling the truth is a revolutionary act" - George Orwell
 

CookieMonster

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By harping on about Fractional Reserve banking in EVERY DAMN THREAD!
 
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