Anglo Offers 0% Loan To Offload 1bn Property Portfolio

[ang]

ANGLO IRISH Bank is hoping to avoid taking a multimillion-euro hit on a €1 billion property portfolio by giving a property developer an interest-free loan to take it off its hands.

The transaction, if it goes ahead, will allow Anglo avoid the losses it would incur if it had to sell the properties on the open market.

The proposed deal with Blanchardstown Shopping Centre owners Green Property is similar to one done by AIB last year, which saw the bank avoid crippling losses on a troubled UK property portfolio.

Green is understood to have earned significant fees from the AIB deal, which was structured so as to minimise the risk to the property company.

Is This A Good Value Deal For The Taxpayer ?

More Here:- Anglo offers 0% loan to offload €1bn property portfolio - The Irish Times - Wed, Feb 03, 2010

[ang]

More on this story.

The properties included in the sale are the Gaiety Centre shopping development on Dublin’s South King Street, two office blocks in London, the Metquarter shopping centre in Liverpool and a redevelopment property in Surrey, which is 50 per cent owned by Green.According to ESRI chief economist John Fitzgerald, the warehousing of such loans could imperil the Government’s salvage operation of the banking system.

Surely UK property prices are on the way up. Couldn't these be sold on the market ?

Times running two reports on this.

http://www.irishtimes.com/newspaper/...263659097.html

[charley]

its a fire sale ,get as much off the books as you can,hide in the coal shed any thing to make it look better than it is ,they are giving a developer a loan to buy property they own just to get it off the books what happens when or if he default on this loan

[fiannafailure]

its a fire sale ,get as much off the books as you can,hide in the coal shed any thing to make it look better than it is ,they are giving a developer a loan to buy property they own just to get it off the books what happens when or if he default on this loan

Anglo get to own the Blanchardstown Centre and we all get loans to buy our shopping

[PaddyJoe McGillycuddy]

Curious transaction indeed!

a senior source at the company described the deal as “complex and sophisticated” and stressed it is designed to ensure the bank “recovers” its money.

I guess “complex and sophisticated” is code for 'opaque'
Seems to be same deal that was done with AIB where Green earned significant fees.
Looks like Green Property have a lot of clout when it comes to Irish banks.
Here's some background on Green from the SBP:
Green machine: ThePost.ie

[ang]

Have just found this thread by Ms Annethrope, can the mods move these posts into that one please.

http://www.politics.ie/economy/11010...re-nama-7.html

[fiannafailure]

PaddyJoe‘

Stephen Vernon has been around a long time. He’s a traditional property developer, and by that I mean that he always thinks long term when he’s doing a deal.

He has never been solely focused on making a quick buck. When everyone else was spending money like it was going out of fashion, he was probably scratching his head wondering what on earth they were all doing. That’s why he’s in the position he’s in now.”

Unusually for the property business, few if any of Vernon’s peers have a bad word to say about him.

‘‘He’s just a nice guy,” said one. ‘‘He is very approachable and very affable. Unlike a lot of people in this business, he didn’t lose the run of himself during the boom - he never got into things like helicopters and private jets, and you never saw him popping up on the social pages.”

Believe it or not there are still a few developers in the same mould, Nama free and ready to do business.

[PaddyJoe McGillycuddy]

PaddyJoe‘



Believe it or not there are still a few developers in the same mould, Nama free and ready to do business.

Indeed. And its not the first 'sophisticated and complex' deal he has done with Anglo

Anglo Irish Bank (Part 1) Gavin's Blog

[PaddyJoe McGillycuddy]

I wonder what Anglo public interest director Alan Dukes thinks of the deal? Former public interest director Frank Daly of the Revenue might have had an insight into the tax implications but he's gone off to chair NAMA.

[HanleyS]

This is just throwing good money after bad. Instead of recognising the loss now and cutting it they're seeking to delay it and thereby increase it. Are they going to give the developer an interest free loan for 40 years?