Irish government guarantee bank deposits

sunshine-days

Today's Irish newspaper:

This guarantee is growing more colossal by the minute. It now stands at perhaps 600 billion euros!

http://www.independent.ie/business/irish/bailout-soars-to-8364500bn-as-six-foreign-lenders-get-protection-1494960.html

I telephoned the Bank of Ireland offshore and they say that they are waiting for written confirmation that they are included in the system, which will not come until the end of next week.

But they added that all their offshore money is kept in Dublin, and therefore logically it "should" be included in the guarantee.

christ

Isn't the point here that Anglo Irish IOM is a fully owned subsiduary of Anglo Irish and they fully guarantee the deposits in IOM?
The Irish Govt in turn guarantees all debts to Anglo Irish, therefore it must be included.
I understand people's nervousness at the moment but imho Angl Irish IOM is one of the safest places to keep your dough at the moment if you live offshore.

gozomark

Isn't the point here that Anglo Irish IOM is a fully owned subsiduary of Anglo Irish and they fully guarantee the deposits in IOM?

subsidiaries are not covered by the guarantee unles specifically agreed, so

The Irish Govt in turn guarantees all debts to Anglo Irish, therefore it must be included.

there is no must about it

the statement from the Irish regulators

"The Government has decided to put in place with immediate effect a guarantee arrangement to safeguard all deposits....with the following banks: Allied Irish Bank, Bank of Ireland, Anglo Irish Bank, Irish Life and Permanent, Irish Nationwide Building Society and the Educational Building Society and such specific subsidiaries as may be approved by Government following consultation with the Central Bank and the Financial Regulator

please don't post things as fact when they aren't

christ

Gozo, I wasn't posting it as fact. Apologies if that's how it seemed. I was just saying that if 1 guarantees 2 and 2 guarantees 3 then I can't see how this isn't the case. I do understand that it hasn't specifically been stated but I can't really see how it wouldn't be the case.

gozomark

christ wrote: »

Gozo, I wasn't posting it as fact. Apologies if that's how it seemed. I was just saying that if 1 guarantees 2 and 2 guarantees 3 then I can't see how this isn't the case. I do understand that it hasn't specifically been stated but I can't really see how it wouldn't be the case.

it was your "therefore it must be included" thats at issue - in your example, 1 has said it will guarantee 2 but not its subsidiaries ie 3 unless it specifically lists them

rob999_2

May I add a few thoughts here too.
(Whether or not the Irish bank guarantee extends to Anglo Irish Isle of Man and it should do, though whether it will do,we shall see).
The fact that Anglo Irish Bank in Dublin-head office in a manner of speaking- guarantees depositors in the IOM, then it would only be if Dublin fails, which is unlikely with the guarantee, would a problem arise.
The Eurozone in which Ireland is included now promises no major bank will fail and that I suggest includes the Anglo Irish Bank Ireland.

And the likes of bank deposits are not the same as shares where the price goes up and do and there is no promise of capital being protected.
In the event which is unlikely that Anglo Irish IOM folds the head office are legally obliged by the terms of their legal promises to reimburse the IOM depositors in full.
I do not believe what with Ireland being in the EU, Anglo Irish will fail, and it is not the same as Iceland, who are not in the Eurozone.

edwinac_2

rob999 wrote: »

I do not believe what with Ireland being in the EU, Anglo Irish will fail, and it is not the same as Iceland, who are not in the Eurozone.

There is a huge unanswered question remaining.. Why did Ireland take the unilateral decision to guarantee all bank deposits?

That guarantee is essentially worthless since the Irish taxpayer could never fund a compensation bill of Eu600bn without going bankrupt.

Without Europe's support - and why did Ireland not seek that before making the guarantee? - the Emerald Isle is in same predicament as Iceland - it has offered a guarantee that would be ruinous to honour.

rob999_2

"There is a huge unanswered question remaining.. Why did Ireland take the unilateral decision to guarantee all bank deposits? " asks edwinac.

My understanding is that without it the Irish banks would have gone bankrupt.

The Irish government bank guarantee legislation is being delayed in passing to enable it to satisfy EU law.

If the guarantee fails then the EU bails out Ireland and the depositors get paid.
The EU has now promised they will allow no major bank in the EU to fail.

iceland, to repeat, is not in the EU.

Have a nice day.

cvd

The EU has now promised they will allow no major bank in the EU to fail.

And the UK is also in the EU.
Hence the Irish banks are certainly no safer for UK residents than UK banks.
Indeed, it is obvious the Irish banks are less safe for UK residents - if you investigate a little...

So it all depends on where you live.

craines

Draft details for the Irish bank guarantee have apparently been released this evening:
http://www.irishtimes.com/newspaper/breaking/2008/1015/breaking57.html
Surely this is what the IOM subsidiaries of the Irish banks have been waiting for in order to determine if they are covered -- does anyone know ? has anyone been able to locate the draft document from the Irish government ? or any update from the IOM banks themselves...?