Brendan Burgess
Founder
- Messages
- 52,185
"We need to address the mortgage arrears. In a lot of cases, people can afford to repay a mortgage based on the current value of the house. Leaving aside the moral hazard, banks just have to write off the residual debt.
And what about the rest of us????? This is a crazy suggestion - those who struggled and kept paying would be penalised for having paid. If that happens this country is well and truly finished.
This is not correct. The Irish Government did not user taxpayers money to write-off bank debts. The then Government guaranteed bank liabilities for a two year period. Subsequent to the ECB issuing recommendations on guaranteeing solvent but liquidity restrained banks, the IE Government recapitalized AIB and BoI and nationalized Anglo-Irish. The point here, and it is important, is that bank debts, i.e. primarily the bonds they issued, were not written-off. The taxpayer paid off these bonds; the banks remained solvent.As crazy as billions of taxpayer's funds being used to write off bank debts?
This is not correct. The Irish Government did not user taxpayers money to write-off bank debts. The then Government guaranteed bank liabilities for a two year period. Subsequent to the ECB issuing recommendations on guaranteeing solvent but liquidity restrained banks, the IE Government recapitalized AIB and BoI and nationalized Anglo-Irish. The point here, and it is important, is that bank debts, i.e. primarily the bonds they issued, were not written-off. The taxpayer paid off these bonds; the banks remained solvent.
The proposal by the Housing Agency that negative equity amounts be 'written-off' by the banks will do nothing but destroy the banks' balance sheets by lowering their book value (and, am I right on this, allow the banks to claim a tax deduction on the written-off values?) So, the taxpayer pays again.
OK, so it was poorly phrased and a simplification. Follow the money, though: who paid (taxpayers, who else) ? who benefited (banks, who else)?
Who did the banks borrow from.
What was all that bondholders about then.
This is not correct. The Irish Government did not user taxpayers money to write-off bank debts.
What about the National Pension Reserve Fund?
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