The revelations of Credit default swaps and treason in
Greece should start to flash red lights here in Ireland as there are enormous
movement in Irish credit default swaps spreads. With well placed insiders are
able to make huge money and nobody is calling for a public enquire, these financial
instruments of mass destruction are been used and nobody knows who’s benefiting
Are we not going down the obvious road to default because of
a conflict of interest by those that are charged with this decision??? How do
we know that special interests are not been looked after???
Can we thrust our politicians? I know what my answer is !
The International Swaps and Derivatives Association (ISDA) yesterday said that a “credit event” had occurred on Allied debt, meaning the bank has effectively defaulted on its debt, a situation the Irish government has gone to extreme lengths to avoid.
Credit default swaps (CDS) sold on Allied subordinated bonds and, crucially, its senior debt, have been activated by the decision of the ISDA determinations committee that decides whether a borrower has defaulted.
The decision by the committee, which is made up of 10 major banks, follows the announcement earlier this month by the Irish High Court of a “subordinated liabilities order” that changed the terms under which junior debt in Allied was originally sold, forcing holders of the bonds to accept an extension in the maturity of the debt to 2035.
Allied had already missed a coupon payment on its Lower Tier 2 debt. However, changes in the law enabled the bank to avoid being forced to be formally placed in default.
For the market, ISDA’s decision renders this move largely irrelevant as it means the bank will be categorised as in default in the eyes of investors.(source http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8590428/Allied- Irish-Bank-has-defaulted-says-derivatives-body.html )
- Greece’s credit default swaps spike (marketwatch.com)
- Country default risk – Greece leading the pack (investmentpostcards.com)
- Ireland Opens New Front as ECB Battles to Avert Meltdown (businessweek.com)
- Ireland revives pledge to go after bondholders (theglobeandmail.com)
- Greek Tragedy: Downgraded Again, And The Prime Minister Accused Of Treason (businessinsider.com)
- Greece Situation Clouds Reason About Bank Exposure (247wallst.com)