Was thinking about this also this yesterday and it is fairly compelling - although to be honest I was considering it from an investor's perspective (i.e. use privat equity to se up bank, rather than Govt).
Issues however would relate to the speed with which such an institution could get up and running and the speed at which it could bring in account holders, have a comprehensive online banking system set up etc etc would mean that by the time it is viable, the economy would have tanked even further due to lack of credit from existing banks (who would have to hoard even more cash to build up reserves in the absence of capital injection).
I think you would achieve the same end by tranferring toxic debt (at market price) from AIB/BOI to Anglo and gradually run down Anglo over a number of years.
I dont favour the transferring of toxic loans from existing banks to Anglo. It rewards failure and keeps the bank employees who got us into the mess in charge. You could guarantee that the couple of existing banks that do survive if no bailout is given would be in much better shape if they managed to get through the experience.
I was not aware that Ireland was exposed to toxic loans or debts.
Joody
This is our banks biggest exposure. Large sums of money given to property speculators in respect of assets that are well in negative equity and the speculators cant afford the repayments.
Staff would be lending under very strict rigid criteria laid down and supervised by the Dept of Finance/NTMA. The time it takes to hire 30 staff, who need not be too senior as being supervised initially by Dept of Finance/NTMA. Probably could be done inside 2 weeks if the will was there.
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