The Irish Central Bank solo run?

thestory.ie/

I wonder if it was our CB that refinanced the banks in Sept? I remember reading it was crunch time with a lot of loans coming due… in the end they got their refinancing, the French & German banks got their loans repaid in full and, I think, it was assumed the ECB was responsible for the refinancing. But looking at these numbers perhaps it was our own CB that did the refinancing and now the powers that be can claim be cannot “burn the bondholders” because it will simple mean our own CB :frowning: Of course BL has been claiming this all along but now it might finally be true.

Conduiting ECB money for bond market operations I should think, the banks can go direct to the ECB.

Is there any chance that our ‘funded til July 2011’ money is propping up our terrible banks?

Picked up by FT Alphaville…

ftalphaville.ft.com/blog/2010/11/15/404211/bailing-out-ireland-bailing-out-banks/

Any chance?

What do you think the huge cash float has been doing?

Why else would Anglo have looked to get Mr. Cowen to get deposits from the NTMA in April 2007? Because the NTMA has been used to prop up the banks. Not necessarily directly, but through the Irish Central Bank.

I don’t believe it is ECB money conduited. I don’t believe there is a mechanism for this to happen. The Irish NCB can ‘issue’ money on it own account in return for qualifying assets. It does this through emergency repo (the marginal rate) of 1.75%.

On what the assets are?
I suspect the long standing 14bn ish is the Anglo MLEC.

The new 20 bn or so are the promissory notes, I’d say. Note, because promissory notes are tradable, it may be that Anglo is trading them out to the other banks for junk bonds so the other banks can repo them for cash. Rumour has it the interbank repo market is closed to Irish bank assets…

There’s a fair whack of bits and pieces (cash on hand propping banks and commercial paper that needs to be repaid) that makes the 60 day claim quite plausible. If this is a case, there’ll be some sort of deal done with the EU/IMF over the next couple of weeks.

Doesn’t it, though?

Especially when you consider that the Irish exchequer is responsible for the solvency of the Irish Central Bank…

What surprises me is that the EU aren’t advocating the opposite i.e. telling Ireland that if they don’t accept the state level bailout, then the ECB emergency funding to our banks will be cut off.

well arent they! viewtopic.php?f=51&t=34119&start=150
Pieces of the puzzle falling together now and looking back its all so obvious

The special European Union bailout facility could not be used directly to support a country’s banks, a source at the European Financial Stabilisation Facility has said.
rte.ie/news/2010/1115/banks.html

Uh oh. (2nd time today)

They’ve changed the wording on that story! Now it both the State and/or the Banks.

I would ask all users to copy & paste RTE stories for future reference as they are revised too easily without note. The original point if trues makes a world of a difference. What games they are playing.

Here it is from another source
abcnews.go.com/Business/wirestor … 692&page=1

The reason for the Irish Central Bank changes in their balance sheet is simple. Some, not all, Irish banks, have run out of things/junk to repo with the ECB, the ECB has cut the cord and forced the lender of last last resort, the Irish Central Bank, to step in. The only other option was for the ECB to print money to prop up the current massive liquidity problem at AIB.

The Irish banking sector is so fucked it is now beyond humour and in recent weeks it has got a lot worse.

So let us get this straight, when the greeks had a crisis, there was bit of contagion but mostly self-contained.

but when the Irish had a crisis, there was
property collapses in Portugal, Cape Verde, Sunny Beach Bulgaria, Spain etc
fears of bank failures across Europe - re RBS and other banks heavily involved in Irish denominated debt
fears of sovereign failures - re the widening of yields across peripheral Europe
fears of the whole bloody euro area through one country defaulting on its obligations

and to think that those campaigning in the Lisbon referendum thought our influence in Europe would be diluted :mrgreen: