PTSB Mortgage? Withdraw all your deposits

S

south_dub

Registered User
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46
Hi,

If, like me, you have a PTSB mortgage and you also bank with them (current account/savings account etc..) can I suggest the following course of action?

Very simply inform them that while you can't presently change your mortgage provider, you are moving all your other accounts to other lenders and then do so. Make it clear that the reason you are doing this is in protest at the unjustified 0.5% mortgage increase.

You would swear most of the people on this site are either bankers or dont have mortgages or have trackers - dont be fooled, the only reason they are increasing their rates is to profiteer at the expense of standard mortgage holders because they are losing money on their trackers. Instead of making 200M profit, they need to satisfy their shareholders with 400M profit. Their massive insurance business can easily subsidise their trackers.

Just my two cents thats all.
 
Well, if you dont need the money now then thats a good idea but I reckon a lot of people wont be able to do that at the moment.

The only reason they have increased the mortgage is because their shareholders need to be satisfied with profits of some sort. I think banks wont make huge profits for a while but if there is anything they can do to increase profits, they will do it. Look, banks will be banks.

Three month euro LIBOR rates are falling and now stand @ 0.899.

Nuff said.
 
south_dub said:
Three month euro LIBOR rates are falling and now stand @ 0.899.
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You are falsly assuming that Irish banks are/were able to borrow at the Libor rate.

I'm not condoning the rate hike, but business is business (not just banks), and profit will always be the driving force.
 
south_dub said:
Hi,

If, like me, you have a PTSB mortgage and you also bank with them (current account/savings account etc..) can I suggest the following course of action?

Very simply inform them that while you can't presently change your mortgage provider, you are moving all your other accounts to other lenders and then do so. Make it clear that the reason you are doing this is in protest at the unjustified 0.5% mortgage increase.

You would swear most of the people on this site are either bankers or dont have mortgages or have trackers - dont be fooled, the only reason they are increasing their rates is to profiteer at the expense of standard mortgage holders because they are losing money on their trackers. Instead of making 200M profit, they need to satisfy their shareholders with 400M profit. Their massive insurance business can easily subsidise their trackers.

Just my two cents thats all.
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Or better still why don't we all withdraw all our money from the banks. Banks are evil and run by very mean people, what right have they not to continue offering cheap credit?

We'd all be better off if we simply took down the banks and reverted to life as hunter/gatherers
 
On a more serious note south_dub, have a read of some basic economic textbooks to find out what happens when a lot of depositors ask for their money bank all at once.

You appear to want to orchestrate a run on the bank which ultimately would result in a lot of depositors losing their money in normal circumstances.

In current circumstances the tax payer would theoretically have to pay billions of euros in respect of those withdrawing deposits and probably nationalise the bank. In practice the government would not be able to raise the cash to pay the depositors so it would have to give IOUs to the depositors and/or find the money elsewhere i.e. either slash services or borrow huge sums at inflated interest rates.

in summary, no good can come of trying to orchestrate a run on PTSB
 
Setanta12 said:
Orchestrating/advocating a run on a bank - I'm sure that must be illegal !?!?!!?
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Very, very weak setanta:

Orchestrate: to arrange or manipulate, esp. by means of clever or thorough planning or maneuvering: to orchestrate a profitable trade agreement

If everyone who expresses an opinions on this forum was accused of orchestrating some kind of action, no one would return to this forum. I wont waste any more time on that one.

When our grandkids are still paying higher taxes as a result of NAMA/irresponsible banking/global recession/irrational exuberence all coming together at once in the year 2009 (note, I am not blaming the banks for everything) then we might all think differently about PTSB's action last week. People seem to forget that there is a state guarantee in place that will have to be backed up by taxpayers money if banks default. Absolutely banks have to be profitable in the long run to survive - there is no point in having an unprofitable banking sector, in the long run. But who says that in the current malaise that banks have to make profits at all? Why cant PTSB subsidise their banking arm from the Life arm for the next couple of years rather than penanlise variable rate mortgage holders who can do nothing in the face of greed like this? The ECB rate is 1%, I am paying 3.75% now (on account of being put on a rate of 3.25% when I came off my fixed rate mortgage). Thats a markup of 2.75% on a mortgage, which is huge.

They are benefitting from the state guarantee. They will benefit from NAMA, where incidentally we (as taxpayers) will be buying their toxic assets from them at a discount and in response they stab us in the back with inflated mortgage rates.
 
To be fair, i think we can understand South Dubs frustration - first credit card rates increase, now mortgage rates.... and people are still loosing jobs by the day.
 
On a personal note I agree with the OP regarding their action but I wouldn't call the cavalry in. Why not send a letter outlining what you are doing and see if they give you some kind of break - worth a shot. BTW - They are not the best on demand accounts available anyway so maybe you should move regardless. I, personally, think this is a move instigated by the 'higher circle of bankers' to push doubt into people on variable rates so they go into (relatively) high fixed rates. But I'm paranoid I tells ya .....
 
south_dub said:
The ECB rate is 1%, I am paying 3.75% now (on account of being put on a rate of 3.25% when I came off my fixed rate mortgage). Thats a markup of 2.75% on a mortgage, which is huge.
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There is a good measure of ignorance fuelling this public outrage.

You are not paying a "mark-up" of 2.75% on your mortgage. The cost of funding to the bank is not 1%.

In fact, at the moment you are current getting a nice little subsidy (paid for by Irish taxpayers) given that you pay only 3.75%.

And let's face it. We are talking 3.75%. You should be a budgeting on paying on average around 5-6% on a mortgage. Enjoy this utopia of very low interest rates while you can.
 
south_dub said:
The ECB rate is 1%, I am paying 3.75% now (on account of being put on a rate of 3.25% when I came off my fixed rate mortgage). Thats a markup of 2.75% on a mortgage, which is huge.
.
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On the 30th June, PTSB paid 3.75% for €1 billion of 1 year funds. That's the cost of borrowing, not Euribor flat and not 1% ECB base rate.
 
Well its only 50000 mortgage holders with PTSB who are effected and the gove have basically said sod off and opened the door for the rest of the banks to follow suit. I believe from converstaions ive had with fellow workers that most are now leaning towards a no vote in the Lisbon ref. A move like this could swing the referendum against the govt.
 
dub_guy said:
Well its only 50000 mortgage holders with PTSB who are effected and the gove have basically said sod off and opened the door for the rest of the banks to follow suit. I believe from converstaions ive had with fellow workers that most are now leaning towards a no vote in the Lisbon ref. A move like this could swing the referendum against the govt.
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It's amazing the number of different ways we can bit off our nose to spite our face.

Come off it, this is juvenille behaviour along the lines of failing a subject to annoy your teacher.

We should vote for Lisbon on its own merits. Rejecting it would probably hurt people in low paid manufacturing jobs a lot worse than it will sting Brian Cowan's ego
 
DerKaiser said:
It's amazing the number of different ways we can bit off our nose to spite our face.

Come off it, this is juvenille behaviour along the lines of failing a subject to annoy your teacher.

We should vote for Lisbon on its own merits. Rejecting it would probably hurt people in low paid manufacturing jobs a lot worse than it will sting Brian Cowan's ego
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Like Brian Cowen and the Gov. We rejected Lisbon. They would not accept our NO vote. So they put it to us again. Who is being childish then
 
Timbo said:
There is a good measure of ignorance fuelling this public outrage.

You are not paying a "mark-up" of 2.75% on your mortgage. The cost of funding to the bank is not 1%.

In fact, at the moment you are current getting a nice little subsidy (paid for by Irish taxpayers) given that you pay only 3.75%.

And let's face it. We are talking 3.75%. You should be a budgeting on paying on average around 5-6% on a mortgage. Enjoy this utopia of very low interest rates while you can.
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I am open to correction here, but the ECB lend money at that rate i.e. Irish banks are borrowing from the ECB at that rate. I believe the ECB has lent 750 billion euro so far.
 
south_dub said:
I am open to correction here, but the ECB lend money at that rate i.e. Irish banks are borrowing from the ECB at that rate. I believe the ECB has lent 750 billion euro so far.
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Only about 25% of PTSB's funding needs come from the ECB through repos of its mortgage book. The rest has to come from customer deposits and wholesale funding hence the margin pressure.
 
south_dub said:
I am open to correction here, but the ECB lend money at that rate i.e. Irish banks are borrowing from the ECB at that rate. I believe the ECB has lent 750 billion euro so far.
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That is the Refi rate. It provides liquidity at the margin to the Euro area banking system.

It is not the cost of the capital (i.e. the liabilities) employed by the banks, which is a combination of deposits, various secured and unsecured bonds, interbank lending, various fixed and floating rate notes and, shareholders capital. Refi loans are a small prportion and do not drive the cost of capital to the bank.
 
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