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THE MINISTER FOR Finance Michael Noonan has announced plans to try to burn senior bondholders at Anglo Irish Bank and Irish Nationwide Building Society.
Noonan is in the US for a four day trip, and today met with IMF officials and the US Treasury Secretary Timothy Geithner reports RTE. The minister says that Ireland will seek to impose losses on the senior bondholders at the two financial institutions, targeting around €3.5 billion in bonds issued.
He says the IMF supports the strategy, and has called the two banks “warehouses for bad debts”.
Noonan also says that Geithner has agreed to support efforts to cut Ireland’s bailout interest rate. The minister has told US news media that Ireland’s corporate tax rate is not up for negotiation, and that Ireland would rather pay a higher interest rate. He said that the Irish were “not for turning”, reports The Irish Times.
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Wow. That only took three years of every expert in the world saying it was the right thing to do. Time for a round of applause?
Brian Lenihan spent the last 2 years buying out Anglo debt and converting it to state debt, so that this could not be done. He worked hard to prevent this and unfortunately it was one of the few areas that he achieved in. There is only the scraps left now, but at least it is something. Traitorous bastard.
As Moan Burton says “A reply I have received to a written parliamentary question to the Minister for Finance, Brian Lenihan, has confirmed that the bulk of the Anglo Irish bondholders have already been bailed out.
The reply (copy below) confirms that only €4bn of senior Anglo bonds, and €2.4bn of the subordinate debt, remain which are not guaranteed by taxpayers.
Anglo has already been given €4bn in cash, €18.88bn in promissory notes and a commitment of another €6.4bn in promissory notes (totalling €29.28bn).
On Black Thursday, September 30th, Lenihan said that the bill for Anglo could be even €5bn higher (which could bring the total tab for Anglo alone to nearly €20,000 k for every person working in the country).
Interest on Anglo bailout alone could run to €1.5bn a year for the next decade, adding to the spending cuts and tax hikes needed to meet fiscal targets.
It is a disgrace that two years were wasted, and bondholders quietly repaid in full, in the two years since the initial bank guarantee was introduced.
It is amazing that the govt. did not use this time to introduce a Special Resolution Mechanism for banks, as was done in the UK after the collapse of Northern Rock for instance, which would have allowed a sharing of the burden between bondholders and taxpayers.
Columnists in the Financial Times and The Economist, amongst others, are baffled by Fianna Fáil’s determination to pile all the pain on taxpayers while professional investors who took a punt on our banks get away scot-free.
The disclosures in this reply will greatly add to the public anger at the huge financial millstone that Fianna Fail has placed around the necks of successive generations of Irish taxpayers.
Sure Pearse Doherty SF was the first to speak of burning the bond holders and all the other partys and news media looked down their nose at him. He was way ahead.
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