Tja die letzte News sorg wieder für unsicherheit wie man sehen kann... Ireland under pressure to meet EU/IMF banking targets
06 February 2011 By Cliff Taylor
Ireland is now under pressure to meet key banking targets set in the EU/IMF plan, with significant state capital injections likely into the two main banks before a new government is appointed, unless the Central Bank agrees a last minute extension to deadlines it has set.
The government and Bank of Ireland have been discussing a plan in which the state would inject capital through non voting shares to allow the bank to meet the end of February deadline set by the Central Bank to raise new capital. The Bank has been in discussions with private investors, but most are loath to invest significantly before tests on the banks capital levels and liquidity are completed by the end of March.
Under the plan, the government would invest up to €1.4 billion and a deadline would be set by which time the shares would convert to ordinary voting shares if the bank had not raised private capital and repaid the state in the meantime.
If no private capital was raised, this would likely increase the state stake from 36 per cent now to between 65 and 70 per cent. The government will also have to put cash into AIB, which still requires more than €4.5 billion in extra capital, even after a recent debt buy back. Further cash may be needed for EBS, likely to bring the state investment to over €6 billion. The money is expected to come from the National Pension Reserve Fund. The only way the early injection of funds can be avoided is if the Central Bank extends the end of February deadline for AIB, Bank of Ireland and EBS to increase their tier one capital ratios to over 12 per cent.
If the deadline was extended until after the capital tests, the banks - and particularly Bank of Ireland - might have an option to raise private sector cash.
The bank’s executives have been working urgently to attract investors - including having discussions with Middle East sovereign wealth funds - with a goal of keeping the state stake below 50 per cent.
Meanwhile another key target set in the EU/IMF programme to transfer all the bank loans to Nama by the end of March will now be missed, after legislation to allow this to happen was not put before the Oireachtas.
Legislation to allow the Nama to take on certain property loans under €20 million in value under a new valuation procedure has been published, but will not now be enacted until the next Dáil.
As part of the deleveraging programme for the banking sector, the government agreed as part of the EU/IMF deal to have all the bank loans due to go to Nama transferred by the end of March. A key part of this was new legislation allowing around 10,000 land, development and associated loans in AIB and Bank of Ireland to be transferred by the end of March this year. This would further shrink the banks’ balance sheets, as demanded by the ECB, though the amounts involved are now thought to be a bit below the initial €16 billion estimate.
New legislation was required as Nama will have to adopt a new valuation process for these loans, classifying them by reference to asset type and region and applying a discount on this basis, rather than the loan-by-loan valuation. The Nama (Amendment) Bill to allow this to happen was published, but the Dáil ran out of time to debate and approve it.
http://www.sbpost.ie/news/ireland/...euimf-banking-targets-54356.html |
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