Colm McCarthy in the SBP

Deserves it’s own thread: … 46195.html
(Courtesy Mr. Lane on IrishEconomy).

Lots of interesting stuff about private sector credit and its contraction:

On mortgage books, as suspected, the good stuff is already securitised:

So that 2.9% greater than 90 days arrears in the securitised book is the best bit…

Fuckin’ brilliant.

Dead right!

He’s one of a handful of public figures to come out of this whole fiasco with any credit.

Unlike Alan Ahearne, McCarthy was too canny to be out manoeuvred by FF. Any FF dirty work he did was done by choice.

McCarthy is a Public Servant in the true sense.

An excellent article by CMcC

Questions: if the bank’s bondholders are to feel some pain in Sep 2010 when the guarantee expires, how would that work with AIB, BOI and Anglo?
The govt owns Anglo - so would it be liable if Anglo defaults on its bonds?
BOI and AIB would need to go into receivership, I assume, then the govt would buy them up.
Previously (due to the success of SI’s pleading), letting the big 2 be nationalised was considered a no-go.

Can NAMA be delayed as long as possible (up to Sep 2010) to try and maximise pain for bondholders?

Probably not. But I don’t think ‘default’ in toto is what is being talked about. Haircut is more like it.

Not really. A haircut from bondholders would not require nationalisation, particularly if it was in return for an equity stake.

I doubt it. I suspect that an argument that may be used is “the government has done what it can. It is up to the bondholders to do the rest”

Good to see at least one individual who is clearly an insider call it as it really is. Shame that he appears to be the only insider doing so…

BTW i wonder if he feels he needs to protect his reputation. Given that he has received such a roasting (on frontline etc.) and is regarded as such a bogeyman amongst some quarters - public sector workers etc. - he might feel that he needs to be just as tough on the banks etc. in order to look unbiased - still even taking that into account good stuff

If McCarthy is like most academics, his primary concern is the respect of his peers. This means his statements have tremendous credibility.

Not according to Brian Lenihan.

But can you not only negotiate a hair-cut (and optional equity stake) if the alternative is bankruptcy?
Not a good outlook for AIB/BOI shareholders if McCarthy’s views swing public opinion and ultimately govt.

As a barrister, Lenihen is trained to maintain credibility in front of twelve people for a few days or weeks. As I’m sure you agree, he could learn a thing or two from McCarthy about stretching this out a bit.

There hasn’t been a good outlook for shareholders since this debacle became evident (and probably before then if you knew what you were looking at).