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Developers score €200,000 salaries from NAMA

Developers score €200,000 salaries from NAMA

 Some of the country’s most indebted developers – some of whom now owe the state billions after their debts were taken on by the National Asset Management Agency – have agreed new deals with NAMA which will see the agency invest in their new dealings – and pay them wages of up to €200,000 a year.

The deals, reported in today’s Sunday Times, mean that the developers – who owe between €1bn and €3bn – have been told they can pay themselves the bumper salaries as part of an arrangement which will see the agency split the profits on the sale or trading-out of some assets, once the developers’ performances exceed certain targets.

The creditors are also to be allowed to keep their homes if the targets are met – but if such targets are not met, NAMA reserves the right to repossess their family homes and sell them off.

The developers involved have also been told to cash in their pensions plans, which contain millions stockpiled in retirement funds, to be used as working capital for their businesses.

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Developers involved include Treasury Holdings owners Johnny Ronan and Richard Barrett, Liam Carroll, Seán Mulryan of Ballymore, Bernard McNamara and Joe O’Reilly.

A NAMA spokesman told the Sunday Times that the business plans submitted by the developers which required agency approval had run into thousands of pages in some cases, and that all had substantially reduced their office overhead expenses.

While the spokesman would not speculate on the individual salaries being paid to developers, he said they had seen their wages drop by between 50% and 75%.

Letter in Saturday’s Irish Times…

Letter in Saturday’s Irish Times…

A chara,

I write to voice my concern about the future of this country. I am sitting on the steps of the Department of Justice & Law Reform, the sun is beating down on my shoulders and I write to expel a dark thought from my mind. What is to become of the disenfranchised generation of Irish citizens whose future happiness and prosperity in this country has been cast in great black shadows by the criminal activities of our financial institutions and the gross mismanagement of our national affairs by our trusted Government?

Like so many other young Irishmen and women, my partner and I have decided to leave Ireland to live and work in another country. I came to the city today to prepare some things for our trip and to say goodbye to the capital for a while, to soak in some of her unique flavour before departing for Perth in Australia. What is it that makes Ireland a special country? What are the deepest moral values that are the foundations of Irish society? As I walk, thinking about Minister for Finance Brian Lenihan’s recent announcement of the country’s national debt (death?) I was deeply concerned not that I no longer knew what this core moral value might be, but saddened to find that I no longer care.

Seemingly, the woeful economic state we find ourselves in is merely a symptom of a far more threatening problem – a spiritual or existential crisis at play in Irish society. My own sense of moral apathy makes me think a deep wound has been inflicted by the bankers’ greed and it is not in our pockets but sadly in the collective heart of the Irish people. We can endure the toxic financial wreck that is Nama’s balance sheet, the grossly unfair debt saddled so abruptly on honest, hard-working tax-payers.

We cannot endure however, the sheer sense of injustice and the total loss of moral law at the filthy hands of these so-called rogues and sleeveens (it is equally disheartening to see we have had cause over the years to establish a colloquialism to best describe such recurrent characters in Irish society).

An example has been set by the leaders of this country that their selfish and cynical behavior is an acceptable discourse in modern Ireland. Our potential to act meaningfully and righteously in this society has been shrouded in this cynicism by the greedy, ignorant brutes that head our banks and by the lackluster unimaginative politicians that sit in our Government offices.

As a young able man I am ashamed that my chosen course of action is not violent protest (there should be rioting in the streets outside Dáil Eireann and Anglo Irish Bank); rather I choose to leave the wreckage – feeling as if a bully has just entered the playing field, burst the ball and walked away.

Sitting outside the Department of Justice Law Reform, whose steps feel like empty totems of the now laughable notion of justice, I think that the task at hand is not to set the country’s financial institutions back on track. It is to inspire an entire generation of skilled workers leaving our shores to return at some point to rebuild Ireland in the spirit of honesty and hard work, with a belief in our ability to live for the prosperity of others as well as ourselves. – Yours, etc,

BEN MULLEN,

Raheen Park,

Bray, Co Wicklow.

Comment:

The sad fact is we are losing the very best of our people to the rest of the world and I believe it is a policy of our current government to encourage this state of affairs. They keep the unemployment figures down and they don’t need to worry that new people will challenge the status quo at the next elections and they can carry on screwing the rest of us !

As a family man it is not possible for me to abandon Ireland nor do I wish to do so I will stand and fight for what I believe is right. We have a beautiful country with one of Europe’s oldest cultures, a proud tradition of rebellion against ternary

The fact it is we are been betrayed by people calling themselves Irishmen is an insult to the past generations of patriots who died for Ireland

Where are the modern patriots of to-day who will stand up against the crooks infesting the Dail and the gangsters that have taken control of the financial resources of our country thus rendering our independence worthless? We are no more independent than we were at the height of English rule!

If you don’t control your own finances you are not in control of your own life the same rules apply for countries. I just feel so “mad” and nobody is responsible, the lunatics are running the asylum somebody has got to do something !

Remember This?

Howard Beale: I don’t have to tell you things are bad. Everybody knows things are bad. It’s a depression. Everybody’s out of work or scared of losing their job., banks are going bust, Punks are running wild in the street and there’s nobody anywhere who seems to know what to do, and there’s no end to it. We know the air is unfit to breathe and our food is unfit to eat, and we sit watching our TV’s while some local newscaster tells us that today we had fifteen homicides and sixty-three violent crimes, as if that’s the way it’s supposed to be. We know things are bad – worse than bad. They’re crazy. It’s like everything everywhere is going crazy, so we don’t go out anymore. We sit in the house, and slowly the world we are living in is getting smaller, and all we say is, ‘Please, at least leave us alone in our living rooms. Let me have my toaster and my TV and my steel-belted radials and I won’t say anything. Just leave us alone.’ Well, I’m not gonna leave you alone. I want you to get mad! I don’t want you to protest. I don’t want you to riot – I don’t want you to write to your congressman because I wouldn’t know what to tell you to write. I don’t know what to do about the depression and the inflation and the Russians and the crime in the street.

All I know is that first you’ve got to get mad.

Irish banks are still in denial

While all the focus has been on losses at Anglo Irish, the other Irish banks are in denial about the scale of State support needed. It is time to face the facts: the three viable banks need over €17 billion, writes PETER MATHEWS 

LAST WEEK, the scary reports of liabilities at Irish banks centred on the colossal Anglo Irish Bank loan losses, the scale of which I (and other analysts) had been only too aware of more than a year ago. The focus on Anglo Irish was understandable, as far as it went. But the banking sector crisis is not just about Anglo. The Government is missing the bigger picture entirely.

The Irish banking system is analogous to a household’s heating/plumbing system with inter-related boilers. The two big boilers are AIB and Bank of Ireland. There are other smaller boilers, including Anglo and Irish Nationwide, which got really badly damaged by using the wrong fuel and, as a result, they’re now broken beyond repair. The correct decision now is to “stop-cock” Anglo and Irish Nationwide out of the overall system, decommission them and wind them down, in an orderly way, over a period of five to seven years.

AIB and Bank of Ireland (BoI) are the economy’s two heavy duty “main boilers”. Both are now in highly unreliable condition, hissing and spluttering and stopping and starting unpredictably. Both need major refits and servicing. They are severely undercapitalised and poorly directed and managed. Yet both persist in pretending they’re in reasonable shape. They are not. And that’s absolutely the case for BoI, notwithstanding the insistent protests that it is okay because it has more or less raised the capital amount indicated as adequate last March.

But that was last March. And last March’s estimates for both AIB and BoI were not enough. BoI needs €6.5 billion, not €3.65 billion. And AIB needs €10 billion, not €7.4 billion.

The proof goes along the following lines. Gross loans in AIB listed for transfer to the National Asset Management Agency (Nama) totalled €24 billion. A (light) 40 per cent writedown on this figure amounts to €9.6 billion, which should be rounded at €10 billion. We note also that AIB will have to absorb large further losses on its mortgage loan book, its corporate loan book and its SME book and also on its personal lending portfolio. In addition, it may well have uncovered exposures on derivatives. For these reasons, and extensive relevant professional experience, I feel conscience bound to point out that AIB definitely needs recapitalisation now of not less than €10 billion. Furthermore, AIB should not be selling its stakes in Polish and US banks. They are the most profitable, cash-flowing parts of AIB. AIB is only doing this as a panic measure to try and plug its deepening capital shortfall.

Similarly, BoI needs a €6.5 billion recapitalisation. Why €6.5 billion? Because in BoI, the listed loans for transfer to Nama were €16 billion. Apply a 40 per cent write down. This amounts to €6.4 billion, which should be rounded to €6.5 billion. All comments applicable to AIB in the preceding paragraph apply also to BoI.

The Educational Building Society (EBS) also needs recapitalisation of €1 billion to cover its loan losses. Four months ago, the Oireachtas Joint Committee on Finance and the Public Service was advised that the three viable banks, AIB, BoI and EBS, needed immediate capital of €10 billion, €6.5 billion and €1 billion. That’s €17.5 billion in total. The question arises: should the State provide all of this on top of the €7 billion already invested in AIB and BoI in 2009? Clearly not. How much of this €17.5 billion should the State invest? Perhaps €11 billion, in appropriate proportions, into AIB, BoI and EBS.

All of this will result in temporary State nationalisation of these three banks. This leads to another question: where will the €6.5 billion balance come from? The State will be in majority control, at levels in excess of 85 per cent, and able to force existing bondholders in AIB, BoI and EBS to take writedowns on their holdings of bonds, while maybe offering them, say, a small debt-for-equity swap as a sweetener to soften the blow. After, say, five years, the banks will have regained reasonable annual-maintainable normal profit levels in the range €3.5 billion to €4 billion, putting the State in a good position to realise, by way of stock exchange or private sales, its investment of €18 billion in these three banks, plus a profit.

Temporary nationalisation of AIB and BoI will merely formalise the reality that, without 100 per cent State support, both are insolvent. Removal of the State guarantee on deposits at this point would lead to a run on the banks’ deposits. However, we see the banks continuing their delusory charade that they are financially sound and independent!

Realism and optimism are essential for recovery. But optimism must be based on reality. As a country we’re facing a stark reality. Protracted denial in the banking industry, the Government, official Ireland and the professions must stop. Unfortunately, the Fianna Fáil-led Government is responsible for the financial destruction of our economy. Regrettably, the Green Party has collaborated in this destruction. These are the facts. The true situation has been denied by the Government for far too long.

Finally, after two years, only in the last few days have the Minister for Finance, the Government and (some of) the banks been forced to admit the true scale of the destruction. What a waste. What a shame.

So let’s stop the stupid denial. Let’s acknowledge the scale of destruction in the Irish-owned banking sector, not just the Anglo Irish story. AIB and BoI have not been honest with us. Their loan losses are also a shock-and-awe story and they’re only being revealed, on the drip, in drawn-out chapters.

Let’s measure truthfully all the appalling financial damage. Let’s insist AIB and BoI are recapitalised at the truthful, honest, correct and much more robust levels (thereby resulting in temporary nationalisation and bondholder participation through bond writedowns) to enable them to make necessary, much larger, loan-loss provisions than they’ve done to date. Let’s reverse the nonsensical, unwieldy Nama project. This can be done speedily and simply. We’ve got to stop what has become a slow-motion Nama/banks bailout nightmare. Let’s roll up our sleeves and face the challenge. And let’s get on with the work of recovery

source http://www.irishtimes.com/newspaper/opinion/2010/0909/1224278513715.html?via=mr

Comment

This is an excelent articel by PETER MATHEWS 

Early August I posted  my disbelief at the figures the EU stress test results for Allied Irish and Bank of Ireland at the time I stated I thought the figures from the EU were false and were conveniently forgetting some serious hidden derivative losses these corrupt institutions’ were keeping off the book through some fancy  account gimmickry  

My figures were for allied Irish were 10 billion and bank of Ireland, I thought 7 billion or there about .So it is nice to see an independent analyst confirm these figures

Comming over the wires I see headlines say

“Ireland has fallen four places to 29th on the list of global competitiveness and its banking system is the least sound of the 139 countries surveyed, according to the World Economic Forum’s annual rankings.”

now what does that tell you ?

You want to know who I am?

This article was sent in this morning and I thought it might be of interest to some of you.

I know I recognize lot of this man’s current life’s problems.
The sordid intervention of derivatives in all of our lives will sometime soon have to be faced up to
We are approaching the event horizon of this apocalyptical event
Everything is been sucked in and when it has consumed everything we will see the mother of all bubbles burst. With the announcement of the Anglo Irish Banks half yearly results and the results of Irish Life & Permanent, there is no mention of their derivative positions and the catastrophic losses there are still hiding from the public (Proof Anglo Irish deals in derivatives (CFD,s) you only need to read this article in the Irish times )http://www.irishtimes.com/newspaper/finance/2010/0827/1224277688678.html?via=rel

with the full knowledge of the current corrupt government
you have been warned!

By John Mele :
You want to know who I am? First, I’ll tell you who I was.
I joined the Marines when I was 18, went to Vietnam when I was 19, was an 0331 machine gunner, survived a tour of duty in heat and humidity in the mountains of northern South Vietnam near the DMZ. My rear base, the Rockpile, was the most remote base in Vietnam at that time, or so we were told. I survived that war and when I got home I used the GI Bill to get into the Boston Architectural Center, a night school of Architecture. I worked days a few years as a construction laborer and then as an office boy in an architectural office. I got married, was accepted to the University of Oregon and got my BA in architecture in ’77, worked, moved a few times (due to recessions), had two beautiful daughters, raised my family, etc.
After Nam I straightened out, as they say, and sailed a pretty solid course even when the seas of the economy were rough. We had our ups and downs, weathered financial recessions, lost one home and built another, finally settled in Knoxville, TN where I had my own architectural business mainly because I couldn’t work in a cubicle with 400 other architects.
But in ’09 that all changed. This is who I am now.
I am a former Marine, Vietnam war veteran, mad as hell and about to lose my home again. As far as I could tell, our entire financial system collapsed. I mean take forty to fifty years of “economic progress” and just dump it. That is in essence what happened. Many are still clinging to it, hoping for its revival. Something will recover but that something will never be what it was before. In ’09 they changed all the rules. The jobs disappeared, gone to China and India. Guys like me and those before us built this great land and were no longer needed. The bridges, the skyscrapers, the industrial centers, the homes, highways, dams and byways, all built by us, was now thrown away as the “financial system” did not need us anymore. Things called “derivatives” took our place. The US auto industry was on the ropes, banks were collapsing, Wall Street was in chaos, and millions saw the future as a place of unemployment or low paying jobs, if one was available.
So, I decided not to follow the same path I’d been on. With no prospects for work and a boiling anger about–what I felt–was a stolen future for me and my country, I decided to take some alternative actions. I had not failed, the system had failed me and I was determined not to give up but also not to be a fool. I was 60 and soon no matter what I did age would get me. Do I go down playing by the ever-changing rules of financial insanity that I was being forced into? Do I take any job and try to keep the home I spent a lifetime working for? In short, do I suck it up again, go to where I must and start over again at 60 and keep my mouth shut and show up for work and do this until I am dead?
Hell, I’d rather charge up a hill and give it my all to save my “SPIRIT”, because that is the most precious part of any of us. Think “Geronimo” and replace it with “Whitehorse” and you get an idea of WHY I planned this. One last gasp, one last charge, one last mission till the forces of my destiny would overtake me. Would I die trying, if so I was willing to face and accept that? Would Whitehorse save me? I had no idea. I had no idea! It all started with a joke I said to my wife. After repeating it a few times it made more sense than what I was seeing around me.

The inequalities of life invade all our lives. In essence we all make decisions within the confines of the hand we are dealt. At age 60 I decided to challenge that hand one last time and in doing so set my SPIRIT FREE.

I am cycling to Whitehorse, on a bike with a 65 pound pack, a 3700 mile trip…I’ll see you there, if I last…

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