Tuesday, April 13, 2010

Economics 13/04/2010: As bad as Northern Rock back in 2008?

So we have some more clarity on the state of our credit flows, courtesy of the latest monthly report from the Central Bank. And boy are we sick. At the height of the financial crisis, Northern Rock had 303% loans to deposits ratio. Ireland Inc? 269% absent risk adjustments on short-term deposits, and 323% once short term deposits risk of call-in is set at 10%.

Ouch! Irish financial system doesn’t resemble Quinn Insurance – it resembles Anglo!


Unknown said...


Is the American Version of Quinn Life

patrick1978 said...

"Ouch! Irish financial system doesn’t resemble Quinn Insurance – it resembles Anglo!"

Goldman Sachs said this about Irish financial system today Constantin

"We believe that both AIB and Bank of Ireland will ultimately emerge as smaller, yet more focused financial institutions. While the entire process could take the next couple of years, its foundations will be laid within months,"


jmc said...

Just wondering what the 77B in Central Bank deposits were? Are they ECB derived funds? And any idea how much of those central bank deposits are on the Anglo and AIB balance sheet?

patrick1978 said...

Dow Jones Industrial Average has gone back to 16 July 2008

David said...

Interesting what a difference a few years make.

I remember at the time the government decided to guarantee all bank deposits that many people seemed to think that Ireland had been rescued from financial meltdown at virtually no cost. Now look where things are.

I suppose the big problem with bank debts, Greece or whatever is that the financial system is a bit like an earthquake zone. The pressure has built up and all the efforts that individual governments make merely shift the pressures from place to place. I have the feeling that no matter what happens there is likely to be a big financial earthquake. The main issue is where it happens. To gratuitously mix metaphors the music is playing and everyone is doing their best to be beside an empty chair when it stops.