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Thread: Subordinated debt holders to share burden of AIB's capital position - Dept of Finance

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    Default Subordinated debt holders to share burden of AIB's capital position - Dept of Finance

    The Department of Finance have confirmed that a Hight Court order has been obtained to issue a Subordinated Debt Liability Order to ensure subordinated bondholders share the burden of the capital position of AIB.

    The Government’s announcement of 31st March set out that the Government will take all the steps it can to reduce the high level of capital required by the financial institutions from the taxpayer. Today’s action is intended to ensure that AIB’s subordinated debt holders share the burden of the capital position of AIB and reduce the level of capital sought from the taxpayer.
    Micheal Noonan TD, Minister for Finance
    In a statement, the Department also confirmed steps were underway to ensure burden sharing by subordinated bondholders in Bank of Ireland and Irish Life & Permanent.

    The Department went on to highlight there are no plans to pursue burden sharing with the senior bond holders of AIB, Bank of Ireland, EBS or Irish Life & Permanent.

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    *sniff sniff* is something burning?
    If there is a future, it will be Green.

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    What is this worth to the taxpayer? Is it not all smoke and mirrors without the senior bondholders having their welfare cut?
    The best way to see Faith is to shut the eye of Reason.

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    ECB's Stark warns Irish banks on emergency funding | Reuters


    Ireland's central bank provided 66.8 billion euros in special funding to its banks as of March 25, part of a total of 181 billion euros borrowed by the banks through the ECB.

    "An emergency case cannot last permanently, it cannot last for years," ECB Executive Board member Juergen Stark told the Irish Independent newspaper in an interview, referring to the near 70 billion euros of exceptional liquidity assistance. "The role of the ECB is to provide liquidity but you cannot say, okay, it is all up to the ECB to fund the Irish banks. It is not a healthy situation that we are providing liquidity of up to 100 pct of GDP to the Irish banks."
    If the ECB pulls that plug things could come to ahead sooner than the bondholders like.

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    Quote Originally Posted by Outlander View Post
    ECB's Stark warns Irish banks on emergency funding | Reuters



    If the ECB pulls that plug things could come to ahead sooner than the bondholders like.
    All bluster from the ECB. There isn't a hope in hell that they'll withdraw support from the banks.

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    A token gesture to keep the masses happy.
    “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” - Friedrich A. Hayek

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    Quote Originally Posted by voodoochile View Post
    All bluster from the ECB. There isn't a hope in hell that they'll withdraw support from the banks.
    They will probably create a special off balance sheet account for Irish banks, but yep, it will last for years, maybe decades, unless we show some cojones and take control of our own destiny.

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    Quote Originally Posted by Cassandra Syndrome View Post
    A token gesture to keep the masses happy.
    Very much so. We will now hear 'we said there would be burden sharing and there is'. Bondholders 1 billion, Tax payer 82 billion.

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    smells like the first step in a debt for equity swap to me.

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    I take it that all of those who accused Noonan of breaking his pre-election commitments on this issue will now be apologising publicly?

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