The AIB thread


#1010

Freedom has its price :angry:


#1011

Well yes. Thats how these bank recaps work. The govt puts in 5bln and afterwards AIB has a mkt cap of 6bln or so, but the govt then owns almost 85% of the company

Look at Citibank for example. In the boom-times, had a mkt cap of 200bln, now has a mkt cap of 100bln, yet the stock has gone from over 50$ to 3.9$.

Basically the government dilutes existing sholders to the point where they own very little of the upside from that point, Eg

After AIB is recpaitalised…even if property prices recover and they are making the money they were making in the boom times, the bubble back so to speak… the stock will only go to 2.5-3 EURO’s at best and still have the same 20bln mkt cap it had at the peak

Shows how toxic picking the bottom in these stocks has been. If you bot AIB stock end last year at 3 EURO’s with equities worldwide recovering…you will most likely never see that price again. For 30 years at least anyway. For anyone who bot at 20 EUR…that price wont be seen again until the average wage is 250k in this country, and assuming AIB has flawless execution until that point


#1012

Execution? Now we’re talking. Is someone keeping a list?


#1013

#1014

3bn USD according to the rumours Eoin on IrishEconomy is hearing.

That’s 2.34 bn euro… short of Goldman, above Emer Lang ( :open_mouth: a realistic Irish analyst working for one of the banks? Or is it just BoI popping at AIB?):
independent.ie/business/iris … 38545.html

How’s that compare to book value?


#1015

#1016

Good price, stock (ADR) has rallied 10% 'ish on the US market.


#1017

At face value, that’s a pretty good result.


#1018

Yeah, it is a good result. €2.5bn in capital released and a 10% increase in market cap means AIB only needs to raise 5 times its market cap now. Rather than 10 times.


#1019

Excellent :smiley:

Plus, of course, the extra for Basel III.

Good thing we don’t have to worry about the cyclical buffer for a while…


#1020

Plus the bit extra for the other losses


#1021

AIB still faces daunting challenge in raising €7.4bn it needs to boost reserves - Simon Carswell -> irishtimes.com/newspaper/fin … 38717.html


#1022

Pension fund could fuel AIB - Lenihan -> irishtimes.com/newspaper/fin … 68213.html


#1023

AIB’s €3.1bn deal in balance -> independent.ie/business/iris … 34798.html


#1024

I wonder what the fees are…


#1025

What a classic crap misleading headline from the Independent. Look at the headline and you think the deal has hit a problem and of course then read on to discover it is the shareholder approval requirement. Woeful rubbish.

We all need to bear in mind that the journo’s that missed the bubble on the way up are not to be blindly followed as they report on the bust.

Just went through the entire sunday business post and not any serious analysis on AIB disposal of Poland and what it means and where it could lead. The SBP suffers from having to output a 100 pages to get sufficent advertising in so much so that the output per journo means they do not have the time to do anything other than fairly “light” reporting. There was another headline on BoI on its front page but again no hard facts or numbers. Its worse at the indo so they fill most of the pages with photos.

AIB have made a mess of things but this deal should rightly have got some proper coverage. It is a postive for all of us. Is it €3.1b of cash thats coming to Ireland from Spain and the taxpayer and country need as much of those cash inflows as we can get. What worried me was if the deal was not doable and whether the expected price was in any way realistic. Potentially €1.8b of cash out of M&T means €4.9b of cash. If they can flog something in the UK for some additional cash then we the tax payers will be better off as they will need less of our money. This will also give foreign investors some confidence.

We should have some analysis this weekend of whether this week marks the end of the beginning or not.


#1026

Majority control of AIB by the state is still likely, says Dutch lender ING

independent.ie/business/iris … 37880.html


#1027

AIB share price is now below the level it was at before the Polish deal was announced.


#1028

selling off the only profitable bit could do that…

although I suspect there may be trouble coming down the line for Poland which makes this sale a good thing.


#1029

Yup -selling off the good bits to shore up the bad bits is, on the face of it, a poor strategic move. But from the taxpayer’s perspective a nice Spanish man has reduced the bank’s capital requirement by several billion euros.