Brendan McDonagh of the NTMA takes on the role: more details here.
Tag: NAMA
On last night’s Prime Time, when asked about nationalisation, Peter Bacon warned that the government would have to buy the privately-held shares and said “they can’t expropriate shareholders’ value.” On the face of it, there isn’t too much to discuss here. I have advocated that the government should purchase the shares at their closing listed stock market value. Indeed, I don’t know any advocate of nationalisation who has suggested “expropriating” valuable shares from those that hold them.
The reason I’m writing about this, however, is that a couple of other people have also mentioned to me lately that they think this legal concern about expropriation is, in fact, the “real reason” why the government is reluctant to nationalise. “Real reasons” according to this line of thinking, are reasons so important that you don’t talk about them to the public.
Ronan Lyons reports some striking calculations on the potential extent of negative equity in Ireland. He estimates that as many as 340,000 homes may be in negative equity, which corresponds to about one home in five. These calculations raise a number of other important questions. What fraction of these loans may end up being defaulted on? And what are the likely losses for the banks? These losses have not been incorporated into any of the calculations relating to the loans going into NAMA, so these losses will be over and above any losses associated with NAMA transfers.
Swedish bank blogging is undoubtedly the new craze on the interweb. I enjoyed this story of the poney-tailed Swedish finance minister scolding Geithner for his plan and the linked-to story dubbing the Swedes “the acknowledged masters of bank rescues” (As an honour, it reminded me a little of when Ireland were the acknowledged masters of Eurovision.) Charlie Fell also has a nice piece in today’s Irish Times comparing the NAMA plan with what happened in Sweden.