herald

Saturday 16 December 2017

Bank shares soar again as taxpayers saddled with €40bn of debt

PUNCH-drunk bankers and politicians have left behind a Celtic Tiger bill of at least €40bn.

Ordinary workers are being given no option except to save basket-case Anglo Irish bank from a black hole.



But most hard-pressed taxpayers will today be wishing that bankers like the shameless Seanie FitzPatrick and Michael ‘Fingers' Fingleton would be sucked into that hole and never seen again.



The “bad night at the casino” is set to hurt future generations of Irish children who will be picking up the tab for the mistake of messrs Ahern, Cowen, McCreevey and the band of bad bankers for decades.



Every man, woman and children is being asked to cough up an average of €2,000 a year just to service the interest payments on borrowings.



While international observers welcomed the announcements on NAMA and recapitalisation, ordinary citizens here should be reeling today.



Labour's Joan Burton said it was a case that “the the Irish people are the lions led by donkeys.



That phrase that was used in Iraq – ‘Shock and Awe' – I am in shock and awe,” she said.



Proving that yesterday's deal was a good one for the banks, shares soared in early trading today. Following days of losses, Bank of Ireland shares shot up nearly 19pc after the opening of the stock exchange. Irish Life and Permanent went up 9.3pc, while AIB shares rose 2.8pc.



But it is the fact that taxpayers will hand over up to €18bn to the ridiculous Anglo Irish Bank that has infuriated people.



Experts are now questioning whether Taoiseach Brian Cowen and Finance Minister Brian Lenihan should cut our losses and disown Seanie's shambles.



It took just a few seconds for Minister Lenihan to hand over €8.3bn yesterday, but if Anglo were to repay the Exchequer at a rate of €1 per second, it would take nearly 700 years to clear the bailout.



“In one stroke, you have doubled the national debt. The loans which have been rung up by the bankers are now the country's sovereign debt,” said Fine Gael Richard Bruton.



But Mr Lenihan insisted: “I understand the impulse to obliterate it from the system but I cannot, as Minister for Finance, countenance such a course.”



He predicted that the State will be looking to offload the bank from its ownership within five to seven years.



Minister Lenihan told the Dail that the bill for winding up Anglo could cost the State up to a staggering €100bn.



The newly-appointed chairman of Anglo, Alan Dukes, argued today that the closing the bank would result in a worse deal for the taxpayer.



He said that for a smaller amount of money, the bank can be steered through the crisis and “has a prospect, and I believe a realistic one, in getting a return for the economy”.



He said in that context the Minister had given “a perfectly good deal for the taxpayer”.



The European Commission was expected to make an interim announcement today on the restructuring plan for Anglo Irish Bank and Irish Nationwide.



It also emerged yesterday that NAMA is to apply an average discount of 47pc on the first loans it will acquire from the five financial institutions involved in the scheme.



The first batch of loans originally worth €16bn, will be bought for €8.5bn.



As a result of yesterday's announcements, AIB will have to raise €7.4bn by the end of 2010 to meet targets set yesterday, however, it is unclear how much of that will be provided from the Exchequer.

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