AIB & BOI Complain of Unfair Competition from Anglo

[Outlander]

Irish Examiner | Irish News | News from Ireland

AIB & BOI are complaining that they have to compete with a bank that can look to the government for support.

Anglo is offering 5% on deposits. The others are getting 3% on mortgage lending. To compete they must loose money. (not possible for a bank to loose money on normal business I know, but that's the story)

Why is Anglo offering such high rates? Does it need to prop up its cash reserve? How deep is the hole?

The government must have known this was coming - they must?

[joel]

Irish Examiner | Irish News | News from Ireland

AIB & BOI are complaining that they have to compete with a bank that can look to the government for support.

Anglo is offering 5% on deposits. The others are getting 3% on mortgage lending. To compete they must loose money. (not possible for a bank to loose money on normal business I know, but that's the story)

Why is Anglo offering such high rates? Does it need to prop up its cash reserve? How deep is the hole?

The government must have known this was coming - they must?

I thought capitalism was more efficient than the state?

[DeGaulle 2.0]

When the UK nationalised Northern Rock it put a cap on the amount of deposits Northern Rock could take so as to prevent unfair competition.

[smitchy2]

I thought capitalism was more efficient than the state?

Government debt has always been priced lower than private debt.
However in our case that could change very shortly.

[muck_savage]

The government wants both AIB and BOI to be successful and independent.

At the same time it is trying to put them out of business by competing directly against them and offering the highest deposit interest rates in the country.

Go figure.