Brits want to sell UB to Paddy


#64

Very negative market reaction to Hester’s removal. I guess he must have said the wrong thing to a Sir Humphrey type. Maybe they should get a Paddy in as a replacement, they know how to plamas the Sir Humphrey’s.


#65

Future of Ulster Bank looking even more uncertain …

news.sky.com/story/1105382/city- … s-break-up


#66

Time to wind down Ulster Bank?

Ulster Bank being examined to see whether its can be carved out of RBS

news.sky.com/story/1105669/chanc … te-us-sale


#67

the whole point of the carve out is to enable the flotation of the rest of RBS - rather premature to talk about winding down Ulster - it will cost UK Treasury either way


#68

It very much depends how RBS funding to UB is structured, and whether or not there are guarantees in place using RBS’s name. If there was a large pension hole, and RBS could walk away with just reputational damage ie not get tangled up in guarantees, it could be worthwhile winding UB up.

It also depends on what RBS believe the UB loan book to be worth, vs the book value of those assets.

Or it could just be a ploy to encourage Paddy to swap it for some decent assets


#69

Thank you. My thoughts are along those lines too. On a strictly legal basis RBS should be able to walk away from UB and leave a liquidator to pick up the pieces without having to put in an extra penny itself. That’s the real sword it’s holding over our government.


#70

How will it cost the UK Treasury if they really have the balls to just walk away?


#71

WSJ says that “Irish banking arm and a also big bundle of commercial real-estate loans” are under review for possibly moving into a separate entity.

Me thinks wind down will be the next step after Ulster Bank is bad banked.


#72

THat’s a question a big 4 or McBain Consulting would charge 6 figures to answer! Are you assuming the loan book can be flogged off to a “vulture” for anything like close to real value

meanwhile Gideon’s been talking at the Mansion House
ft.com/cms/s/0/66818398-d8fd … z2WSrMeOes

ft.com/cms/s/0/f7ba81de-d90c … z2WSrMeOes


#73

I don’t think a liquidator picks up the pieces, strictly speaking. I know what you mean though.

Having a quick go at what a big four would provide for 6 figures, if you wind up/liquidate, your assets must equal your liabilities. If they don’t, the liabilities must take a haircut, like Cypress. So if the views held my many on the pin are believed, then the liabilities will likely take a hit, with equity being the first one to go, ie RBS money. Its lost money anyway, so that won’t be a concern.

The tricky bit is where does the other funding come from. If its RBS provided loans, then RBS will take a haircut like everyone else. If its an RBS backed loan (bonds, notes, swaps whatever), the people who are owed the money will take the haircut and at the same time pursue RBS for the same haircut which they will pay. So RBS would effective take a haircut on anything that is funded by them, or liabilities that has their name on it. The liabilities that only has the UB name on it, RBS will make money on effectively.

So the question is, is there more RBS named liabilities on the UB balance sheet then not. My guess would be that there is way more RBS named liabilities. All the swaps would be in RBS’s name for a starters, I’m almost 100% sure of that. I would guess that any funding obtained near at the credit crisis would have RBSs name on it too, as long as it hasn’t been rolled over. After that, I would imagine Central bank of Ireland debt wouldn’t have RBS’s name on it.

But the more stuff that has RBSs name on it, was probably obtained at a cheaper rate than just with UB’s name. Which leads me to believe that its not worthwhile RBS pulling the plug. Hence my suspicion that its a ploy or a bargaining chip.

EDIT: on reading the first post on this page, the RMBS notes would be the kind of liabilities that wouldn’t have the RBS name on them, and perhaps the ploy is to scare these guys into accepting a low percentage of par, netting RBS/UB a tidy little saving.


#74

Chancellor George Osborne considers Ulster Bank move

bbc.co.uk/news/uk-northern-ireland-22980758

IBOA requests meeting with British Chancellor over Ulster Bank

rte.ie/news/2013/0620/457640-ulster-bank/


#75

Ulster Bank to close up to 39 more branches on island of Ireland

rte.ie/news/business/2013/07 … ster-bank/

I assume this means that RBS have decided to keep Ulster Bank open.


#76

Actually I would think that would be a separate “project” to the whole bad bank/privatization/high tail it home decisions.


#77

Fair enough, seems strange that UB would not wait until the outcome of the UK govt/RBS decision before making an announcement so.


#78

Ulster Bank facing a ratings hit over RBS break-up plans - Colm Kelpie -> independent.ie/business/worl … 99273.html


#80

independent.ie/irish-news/co … 38348.html

you’d have to feel sorry for ulster bank with customers like this.

retired aer lingus pilot so should be on a good retirement package and in receipt of state pension too I’d expect. (isn’t that right?)
he was savvy enough to get a preferential interest only mortgage on an investment property but when it reverted to full repayment he threw his toys out of the pram.

he is blaming the state for bailing out banks even though Ulster didn’t get bailed out.
This guy got a mortgage of 80k euro on an apartment in limerick in '99. 14 years on he should have cleared that mortgage but for some reason he didn’t clear it and ends up in court for vandalising ATMs.

Roll on the reposessions I say.


#81

McEwan faces RBS’s existential questions -> ft.com/intl/cms/s/0/20baa91a … abdc0.html

UK Treasury appoints BlackRock as asset specialist advisor for RBS bad bank review -> hereisthecity.com/2013/07/13/uk- … sor-for-r/

Lawson: Split RBS ‘now’ -> bbc.co.uk/democracylive/hous … s-23440204

RBS: A Split Could Be Good For Shareholders [ANALYSIS] -> valuewalk.com/2013/07/rbs-split-good/

JP Morgan Cazenove to advise on sale of RBS and Lloyds -> hereisthecity.com/2013/07/19/jp- … nd-lloyds/

35% of Ulster Bank arrears customers not paying -> irishexaminer.com/business/3 … 38748.html

Ulster Bank’s losses down to £329m -> bbc.co.uk/news/uk-northern-ireland-23545750


#82

Ulster Bank has no plans to write off debt - Louise McBride -> independent.ie/business/iris … 70751.html


#83

RBS sell-off ‘not likely within next five years’ - Donal O’Donovan -> independent.ie/business/worl … 91068.html


#84

Ulster Bank stress tests due in fortnight - John Walsh -> irishexaminer.com/business/u … 39645.html