Round two of banking crisis - Alliance and Leicester next??

[Orwellgeorge]

These guys lost over 7% yesterday. They are down about 45% of share value in less than 3 months.

All it will take is one more bank or lending institution to go pop and the game is up. Inter bank lending is getting more costly again and we are heading into round 2 of the banking crisis.

[fishfoodie]

Wasnt this down to a rumor that they had to approach the BoE for cash ? And the quickly quashed the rumor.

[Orwellgeorge]

I recall that Northern Rock quashed a few rumours along the way as well…

My point is that perception is everything. The BOE has said that it’s facility to NR can not be indiffinite. Inter bank rates have moved up again and so it is a matter of time before one or two lenders find a queue outside thier door when they turn up for work some morning. It only takes a few percentage points shift in deposit versus borrowed in finance to tip the balance.

Either way the credit crunch that was supposed to ease up after a few months has not done so and is instead intensifying. In a game such as the Irish property racket that is leathel. Hold your cash tight, value is about 1 year away.

[CelloPoint]

@Orwellgeorge

All it will take is one more bank or lending institution to go pop and the game is up.

How true. I wonder how many pops the Irish economy could withstand?

When you think of how many tales there are out there (prime example is the Jury’s site in Ballsbridge), there could be many a twist yet.

Fresh mortgages is only the tip of the iceberg folks.

[Open_Window]

@CelloPoint

@Orwellgeorge

All it will take is one more bank or lending institution to go pop and the game is up.

How true. I wonder how many pops the Irish economy could withstand?

When you think of how many tales there are out there (prime example is the Jury’s site in Ballsbridge), there could be many a twist yet.

Fresh mortgages is only the tip of the iceberg folks.

What about the Jurys site??? I don’t know what you mean…Maybe I’ve missed a thread. yea it was overpriced, but what has it strecthed a bank a litttle to far

[Pill]

Credit crunch claims new UK victim
Tuesday, 20 November 2007 13:01
The protracted global credit crunch claimed a new British victim today, as mortgage lender Paragon warned it may need to raise funds from shareholders, sending its stock down as much as 50%.

The warning sent fresh shock waves through Britain’s already battered banking industry, with shares in Northern Rock suffering one of their biggest falls since it was forced to seek emergency funding from the Bank of England in September.

Bradford & Bingley, Britain’s biggest buy-to-let mortgage lender, added to jitters by saying it had sold loan books comprising over £4 billion sterling of assets to increase its liquidity.

AdvertisementGlobal credit markets seized up in August, as banks cut back on lending as they tried to assess their own, and each others’, losses on poor quality US mortgage loans.

Most Irish and British lenders, including Northern Rock and Paragon, do not have much exposure to the so-called US sub-prime mortgage market, but have been hit by the drop in lending.

Hopes of a swift return to normality have faded in recent weeks, as the world’s biggest banks have announced more than $50 billion of losses and asset write-downs.

Paragon, Britain’s third-biggest provider of mortgages for people who rent out properties, said the drop in lending meant that it had not been able to renew a £280m loan facility on acceptable terms.

As a result, it had entered into an agreement with UBS which would allow Paragon up to the end of February to raise money from its shareholders, underwritten by the Swiss bank, if it remained unable to renew its loan facility

rte.ie/business/2007/1120/paragon.html

[Calvin_J]

@Orwellgeorge

Hold your cash tight, value is about 1 year away.

I like the sound of that.
My own estimate, for when value would return to the market, was 2009 at the earliest. But you could be right.