• Home
  • NAMA property for sale
  • About
  • The Developers
  • The Tranches

NAMA Wine Lake

Click the green link above for latest news and over 2,600 related articles. NAMA – National Asset Management Agency – part of Ireland's response to its banking crisis and property bubble

Feeds:
Posts
Comments
« Shock and despair amongst Dublin’s legal profession as NAMA spends just €23,000 in quarter on legal fees – the NAMA report and accounts for Q1, 2012
NAMA launches new website features to sell its property »

NAMA “Cortina developer” wins €30m in Dublin court battle with bank

July 29, 2012 by namawinelake

He mightn’t have earned credit amongst the developer community when he claimed NAMA was trying to put all of its developers into three bed-semis and Ford Cortinas, but developer and businessman David Agar this week demonstrated his finer qualities when he won €30m in a court settlement following a case he had taken against Ulster Bank, part of the RBS group.

Harry Wilson at the Daily Telegraph yesterday evening reported that David has settled a High Court case which was initiated in December 2010 (High Court reference 2010/11057 P) . The case involved the misselling of interest rate swaps – insurance policies sold to borrowers to protect them against future interest rate rises on their loans – and according to the Telegraph,  the win means that Ulster Bank will “write-off swaps and loans worth €30m as well as covering Mr Agar’s legal costs, which are believed to total about €1m.” Given the win seems to correspond with an Ulster Bank loss, there is unlikely to be any benefit to NAMA. As the case was settled, there won’t be a judgment.

Misselling these swaps, or insurance policies, involved the banks selling these policies where it was inappropriate to do so or where the cost exceeded potential benefits – the banks have been held to have had a professional duty in advising their borrowers in relation to these insurance policies which boosted bank profits and bonuses.

The win is believed to be the tip of an iceberg of potential losses faced by British (and Irish) banks for misselling these insurances to their borrowers, and comes in the wake of other malfeasance by banks including the overcharging – alleged by some to be deliberately orchestrated with knowledge and consent going all the way to bank boards – of interest on lending by Irish banks.  Yesterday, the Evening Herald revisited the old story of Anglo’s overcharging, which the present CEO has said might cost the bank up to €100m. The Herald reminds us that Anglo will waive its rights under the Statute of Limitations of six years, in meeting claims of overcharging of customers.

UPDATE: 29th July, 2012. A couple of people have privately asked who David Agar’s solicitors were in this case. According to the Court Service, the solicitors on record is Downes, presumably Downes in Dublin 2, telephone 01-676-2546. Also to access case details at the High Court, you have firstly to accept the Court Service terms and conditions here, and then enter the case reference or other search information to get the case details. For what it is worth, Ulster Bank was represented by A&L Goodbody.

Advertisement

Share this:

  • Twitter
  • Facebook
  • Reddit

Like this:

Like Loading...

Related

Posted in Banks, Developers, NAMA | 33 Comments

33 Responses

  1. on July 29, 2012 at 6:53 pm who_shot_the_tiger

    David Agar deserves full credit for pursuing the banks for mis-selling SWAPs to its customers. It is an area that has been given a lot of publicity in the UK but virtually none here. Again, I wonder is this a deliberate policy on behalf of the government and the media to limit the damage to the banks of their fraudulent activities, based on the fear of further billions of losses. It is to be noted that Anglo also aggressively deliberately pursued this lucrative scam.

    In the UK “Bully-Banks” has organised the victims into a fighting group. See copy of recent email below:

    BEGIN
    Bully-Banks now has a membership of over well over 1,200
    individuals who together own over 600 SMEs each of which has been
    mis-sold an IRSA. The establishment of such a large membership in
    such a few months is something that gives us great hope going
    forward. We believe that the increased number of members will
    transform our capabilities going forward.

    * Bully-Banks is now a group of people who have claims against
    various banks to an aggregate value in excess of £300 million. We
    now need to organise ourselves taking into account that fact and
    the influence it gives us as a group.

    Lobbying Activities
    * Our lobbying activities have been quite successful so far. We are
    greatly indebted to the cross-party group of MPs led by Guto Bebb
    and Toby Perkins. We are also indebted to every MP who has met with
    their constituents and who have taken up their constituents’
    complaint that they have been mis-sold an IRSA.

    * The issue of the mis-sale of IRSAs is definitely in the public
    arena. Our challenge is how to take our lobbying campaign forward
    and to make it deliver an effective solution.

    The Financial Regulator
    * We have achieved significant success in prompting the FSA to
    conclude that IRSAs have been mis-sold. We have in the process
    established a line of communication betweek the FSA and
    Bully-Banks.

    * The agreement between the banks and the FSA announced on 29^th June
    (“the Agreement”) is however a major disappointment. For the
    reasons already communicated to Bully-Banks’ members and to the FSA
    we believe the Agreement is fundamentally flawed.

    * We need to create an effective response to the Agreement by taking
    our concerns about the Agreement to the body supervising the FSA
    and ultimately to Parliament.

    Media Coverage
    * Together we have achieved significant success in prompting media
    coverage of issue of the mis-selling of IRSAs. Continued media
    coverage is essential if we are to increase our membership
    further.

    * We need to develop and implement a strategy to sustain media
    coverage over the next six months.

    The Next Few Months

    The Agreement between the FSA and the banks is misconceived. We are
    convinced that it will not deliver a solution to the problems caused by
    the mis-selling of IRSAs and our planning is based on that conviction.

    Bully-Banks’ Membership
    * We need to increase the membership of Bully-Banks. An increased
    membership will deliver increased resource, an increased status in
    discussions with government and an improved negotiating position
    with advisors and service providers. We can also use that
    increased membership to deliver more compelling evidence of the
    banks’ activities.

    * To that end we have available a PDF of a very simple advert which
    we should be grateful if members would place in their local papers
    raising awareness of the issue and of Bully-Banks. We are asking
    members to select a local paper and arrange and pay for the
    insertion of the advert. We also ask members to let us know the
    name of the local paper in which they place the advert. The advert
    can be found on

    [2]http://bully-banks.co.uk/wp-content/uploads/2012/01/bully-banks-adve
    rt.pdf
    Links:
    2. http://bully-banks.co.uk/wp-content/uploads/2012/01/bully-banks-advert.pdf

    * The first meeting of the members of Bully-Banks that took place at
    Bicester was a very positive event and generated a great deal of
    energy for the campaign. Given the activity that has taken place
    since our last meeting, we believe that it would be very worthwhile
    to bring members together again.

    * We are investigating the possibility of holding a National Meeting
    of the members of Bully-Banks and are focusing on a meeting in the
    Birmingham area. We do not know how many members would be able to
    attend the meeting but we are hoping that every member would make
    the effort (That would produce an attendance of over a thousand
    people at current membership levels.) A meeting of that scale
    would enable us to generate media attention and assist us in our
    lobbying activities.

    * Our initial thoughts are to try and arrange a meeting on a Sunday
    as soon as we can. We are already investigating appropriate
    conference facilities and their availability. If there are any
    members with hotel and conference facilities that could be
    available for such a meeting may we ask you to contact us through
    [3]membership@bully-banks.co.uk or by phone to Paul Adcocks on
    07918 716 234 in the first instance.
    Links:
    3. mailto:membership@bully-banks.co.uk

    * In addition we are considering holding a number of regional
    meetings throughout the country and would ask any members with
    hotel and conference facilities that could accommodate from 100 to
    200 members to contact us through [4]membership@bully-banks.co.uk
    or by phone to Paul Adcocks on 07918 716 234 in the first
    instance.
    Links:
    4. mailto:membership@bully-banks.co.uk

    * If you have strong feelings about whether you would prefer a
    national or regional conference please let us know your views (and
    your reasons) by emailing us on [5]membership@bully-banks.co.uk .
    Links:
    5. mailto:membership@bully-banks.co.uk

    Lobbying Activities

    * We need to take advantage of the Parliamentary Summer Recess and
    take our dis-satisfaction with the Agreement between the FSA and
    the banks to the Treasury Select Committee. We will do this working
    in tandem with the cross-party group of MPs.

    * We need to ensure that we contact every single MP over the summer
    months to communicate to them the essence of our case and to secure
    their help as we continue our campaign in Parliament after the
    Summer Recess. To this end we will be preparing a second
    Bully-Banks’ Report.

    The Financial Regulator
    * We will co-ordinate the response of Bully-Banks’ members to the
    banks as the banks begin to implement the Agreement. To this end we
    are asking members to keep us informed of communications from their
    bank about the Agreement, action being taken by the bank pursuant
    to it and details of the proposed review of their case.

    * We will monitor the implementation of the Agreement by the banks.
    Again we will ask members to keep us informed of all developments.

    * We will review how we can assist individual members in their
    response to their bank as they implement of the agreement.

    * One of the major issues is that of time. Waiting to see how the
    Agreement is implemented is a major handicap for SMEs given the
    financial difficulties they face as a result of the mis-sale of an
    IRSA. This delay is a particular concern given that we are
    convinced that the Agreement will not deliver a solution. Once
    again delay and procrastination will be to the banks’ advantage and
    will only handicap and damage Bully-Banks’ members.

    Media Coverage
    * Maintaining media coverage is a key activity for us.

    * We need members to be prepared to provide stories that will
    maintain the media’s interest. (For example we are currently
    trying to identify Relationship Managers from within each bank
    who are prepared to talk about the way in which they were briefed /
    trained by their bank to sell IRSAs and they way in which they were
    set targets in connection with the sale of IRSAs. If you are still
    in contact with your Relationship Manager at the time you were sold
    the IRSA and still have a reasonable relationship with them, may we
    ask you to see if they would be willing to discuss those matters
    with a journalist on an anonymous basis. Do let us know the name
    and contact details if you know of a Relationship Manager who is
    prepared to have that discussion.).

    Legal Action
    * In the light of the Agreement between the FSA and the banks, we
    believe that it has become much more likely that the solution to
    the problems caused by the mis-selling of IRSAs will have to found
    in the courts. In simple terms, the FSA has failed us. We will
    challenge the FSA’s decision by lobbying Parliament but we need to
    address how we go forward if we fail to get the FSA’s decision
    reversed.

    * We are in discussions with a number of firms of solicitors and
    counsel to see how we can best assist individual members. We are
    discussing the possibility of class actions or test cases and how
    we can best deal with the issues of law that arise is many of our
    individual cases. We are also discussing how we can best share
    information, evidence, legal opinions etc amongst our membership
    and their advisors to assist them in the preparation of their
    cases.

    * Clearly the issue of the funding of the actions is crucial. We are
    looking at Conditional Fee Agreements (“CFAs”) with solicitors and
    counsel to cover the costs of Bully-Banks’ members’ legal fees and
    the necessary ATE Insurance against a banks’ costs in the event
    that an individual legal action is unsuccessful. The issues are
    complex and we are taking our time before we come to the membership
    of Bully-Banks with a proposal as to how we should go forward.
    Clearly we hope that the aggregate number of Bully-Banks’ members
    will both facilitate the availability of CFAs and the ATE Insurance
    and enable us to reduce the costs involved in each of these.

    * The matters are complex and we do need to improve our understanding
    of the alternatives available before communicating alternatives and
    / or recommendations to the members of Bully-Banks.

    * Once Bully-Banks has agreed with the members how the membership
    would like to move forward on these issues there is a significant
    co-ordination activity to ensure the cost effective provision of
    legal advice on the various issues that arise (e.g. the sharing of
    legal opinions on the technical legal issues that arise amongst the
    membership).

    * Bully-Banks’ role in these matters will need to be clarified and
    formalised going forward. This will require a constitution and
    election of officers. We will be preparing the draft constitution
    and the necessary formalities before bringing them to the
    membership.

    * We ask for your patience and support as we organise these matters.

    Mis-Sellling Line
    * As and when new members join Bully-Banks many of them wish to talk
    to an existing member of Bully-Banks. They may do this shortly
    before joining (to gain confidence about the decision they are
    about to make) or just after they have joined. They all wish to
    have a better understanding of Bully-Banks and most gain great
    confidence from a personal conversation with an existing member.
    Often they wish to talk about their own situation and sharing it
    with another individual who has also been mis-sold an IRSA can be
    of great personal benefit to them.

    * It is a really important part of Bully-Banks, the sharing of common
    experiences, and it often gives real benefit to the new member. We
    are asking for help from existing members to better manage the work
    load and the effectiveness of our response to these type of phone
    calls.

    * We are proposing to set up a telephone service whereby an
    individual can phone in and be directed to a member of Bully-Banks
    (in broadly the same part of the UK as the caller) who is willing
    to have a conversation with the new member and share experiences.

    * We are therefore setting up Bully-Bank’s “Mis-Selling Line” and we
    need, say, twenty of our members spread across the UK to volunteer
    to take these calls. If you are willing to talk to prospective or
    new members of Bully-Banks please phone Jan Hutchinson on 01202
    701047. Jan will need your phone number and email address. Jan
    will be co-ordinating the existing members who volunteer to talk to
    new members on the “Mis-Selling Line”. She will be allocating
    callers to regional volunteers to talk to them as and when calls
    are received. If you are willing to talk to prospective or new
    members do call Jan.

    Actions To Take

    1.
    There is a section on Bully-Banks’ website called “What You Can Do”.
    Do read it and make sure that you have issued your “Subject Access
    Request” to your bank if you have not already done so. There is also a
    separate suggested letter to send to your bank in connection with the
    Agreement between the FSA and the banks the object of which is to make
    sure you get in the queue for the review. The link is
    http://www.bully-banks.co.uk/what-you-can-do/

    2. The FSA have issued “clarification” of the Agreement with the banks
    and it is available on
    [7]http://www.fsa.gov.uk/library/other_publications/interest-rate-swaps
    /interest-rate-swaps-faqs
    Links:
    7. http://www.fsa.gov.uk/library/other_publications/interest-rate-swaps/interest-rate-swaps-faqs

    3. Finally, Jeremy Roe was interviewed by Sky News in late June before
    the Agreement between the FSA and the banks was announced. That
    interview is now available on the home page of
    [8]www.bully-banks.co.uk.
    Links:
    8. http://www.bully-banks.co.uk

    Many thanks.

    Bully-Banks
    [9] Follow Bully-Banks on Twitter | [10]Like Bully-Banks on on
    Facebook | [11]Forward to a friend
    Copyright © 2012 Bully Banks, All rights reserved.
    You are receiving this email because you signed up for the Bully Banks Newsletter on our website.
    Our mailing address is:
    Bully Banks
    Downe House
    Hartland
    Hartland, Devon EX39 6DA

    END

    I am sure the Ulster Bank is feeling a lot less arrogant and bullying today.

    In relation to the Evening Herald article, Cormac Murphy is naive in the extreme if he believes the statement that “no finding of intentionally misstating the rate has been made in the Anglo case, it is understood.”

    Well Cormac – it isn’t understood. The dogs in the street are ell aware that Anglo ran its own version of DIBOR known by the Anglo executives fondly as “TIBOR” after Tiernan O’Mahony, Anglo’s former Head of Treasury, who set it. The Anglo Board knew what was happening. It was even implemented in the USA – a dangerous strategy. And if you are checking your Anglo statements, note well that this was not the only way that clients were deliberately scammed in the manipulation of interest rates. The 360/365 scam was also used. Do not trust the “cheque in the post”. My advice is to contact BankCheck to run the numbers independently.


    • on July 29, 2012 at 7:03 pm namawinelake

      IRSA = Interest Rate Swap Arrangement


  2. on July 29, 2012 at 8:04 pm John Gallaher

    Whatever happened to caveat emptor,dont get in the water of you can’t swim,especially with sharks.
    Greed pure unbridled by both parties,if you don’t understand why or what you are doing, how about don’t do it !


    • on July 29, 2012 at 8:21 pm Poacher

      @JG. Hi John. The SWAPs were all conditions of the loan agreements. Remember the mis-selling of various shady insurance products by the banks as part of their mortgage offers?


  3. on July 29, 2012 at 8:31 pm John Gallaher

    @Poacher I really don’t have enough information on the swaps to properly evaluate,but were they a condition of the loan ?
    The above comments regarding the ‘loss’ reminded me of that great line in The Guard.

    “Sergeant Gerry Boyle: You lads always announce seizure of drugs worth a street value at $10 million or $20 million or half a billion dollars. I wonder what street it is you’re buying your cocaine on, because it’s not the same street as I’m buying my cocaine on.”


    • on July 29, 2012 at 8:56 pm namawinelake

      @John,

      In the UK, the Daily Telegraph has latched onto, and championed the issue

      http://www.telegraph.co.uk/finance/rate-swap-scandal/9222628/MPs-to-discuss-interest-rate-swap-mis-selling-claims.html

      http://www.telegraph.co.uk/finance/rate-swap-scandal/

      Caveat emptor may generally apply, but in the UK they have already held that so-called payment protection insurance was widely missold and billions have been refunded to consumers.

      You might have expected business customers to have more cop-on, but it has been held that mis-selling of interest rate swap arrangements also occurred and that banks had a duty to customers not to sell them products which were inappropriate or where risks were not adequately explained.

      David Agar’s victory is the first one I have come across in Irish courts, where it appears the same standards as in the UK seem to be applied.

      I imagine that the phone at David Agar’s solicitors, Downes will be busier than usual tomorrow!


      • on July 29, 2012 at 9:47 pm John Gallaher

        @NWL ‘victory’ it was settled out of court,w/o any acknowledgement off wrongdoing or misfeasance,but agreed with costs.What did he win,if you have banking relationships you don’t end up in court,the relationship is self policing,the bank wants you to do well and prosper.
        Baesd on Agars ridiculous interview with Niamh in the Sindo,he should never have been sold then,unlikely he comprehended what he did.
        The swaps were probably unwond,he got released of any personal guarantees best case.Well done David, now how we doing about paying back NAMA and the Irish state what you owe !
        We had a load of yield chasing mom and pop investors burnt in Auction Rate Securities,guess what ?
        If you had a big enough AC and were a viable long term borrower/customer,you got your money back from Chase/BofA etc.Key word is investors chasing higher yields.

        “Auction-rate securities, which were issued by cities, schools, hospitals and others, are long-term debt instruments that are resold with updated interest rates in periodic auctions held by banks. Many investors bought them on the advice of their brokers, who often touted them as a higher-yielding, but still safe, alternative to cash. Then, in early 2008, Wall Street dealers suddenly stopped buying the securities at auction.”
        http://online.wsj.com/article/SB10001424052702304879604575582272276490314.html


      • on July 29, 2012 at 10:24 pm who_shot_the_tiger

        @John. There are no banks left in Ireland, John – just busted flushes. They have all morphed into collection agencies and there is no such thing as a “banking relationship”. Ulster Bank has been a particularly nasty “bully-bank”, as it is widely rumoured that it is on its way out and doesn’t give a toss about its customers. In fact, it is planning to sell one billion euro of its clients’ assets and has not yet told them anything about its intentions. It is even selling customers’ assets to its own in-house acquirer fund West Register.

        West Register is RBS’s investment company which acquires property from “financially distressed” situations, with a view to exiting when market conditions improve.

        And who “encourages” the “financially distressed” customer to sell?……. Got it in one!

        So… What banking relationship? There is just the bully boy one.


    • on July 29, 2012 at 9:38 pm who_shot_the_tiger

      @John. I have loan offers from most of the Irish banks. All of them required SWAPs as a condition. It was a sweet way of adding substantially to the profits without the borrower being aware of it. In many cases more were made from the SWAPs than from the margin on the loan.

      In one case, I even have a bank requiring a SWAP that was 6 times the length of the loan! I kid you not.


  4. on July 29, 2012 at 10:29 pm John Gallaher

    @WSTT hi wstt,seriously people like Agar,shock horror the bank/advisor acted in its own interest.Stop the press….if anything more a sad pathetic indictment of the lack of financial acumen and street smarts of Irish Developers.Did they never socialize have a pint with guys who worked/ran these shops ?
    Chase just got a bloody nose over this but really,everyone in financial services knows the “game”.He’s hardly a widow and orphan,if he was solvent viable customer they would have worked it out,as gentlemen do!

    “Several brokers told The New York Times that they had been encouraged to favor JPMorgan funds, and they described a broader culture that emphasized sales over client needs. Also, in the marketing materials of one major offering, JPMorgan published hypothetical performance results, even though actual returns existed, according to internal bank documents reviewed by The Times. In each case, the actual gains were lower than the theoretical results.”
    http://dealbook.nytimes.com/2012/07/11/jpmorgan-pushed-sales-of-its-funds-even-at-clients-expense-brokers-say/


  5. on July 29, 2012 at 11:22 pm who_shot_the_tiger

    Hi John, They were sold as loan protection against rising interest rates – except the banks and everyone else knew that rates were not rising – anything but! However, they were a condition of every loan.

    There is only one bank in Dublin that was/is in any way staffed by gentlemen and that is BOSI. And it’s no longer got a banking license. Just a one way ticket off the island.


  6. on July 30, 2012 at 12:16 am John Gallaher

    @WSTT sorry to hear that,perhaps NAMA could fill the void !
    Sounding very warm and cuddly lately,perhaps the dalliance with the overseas investors did not pencil or “macro” out.


  7. on July 30, 2012 at 6:50 am who_shot_the_tiger

    Article in Irish Times this morning on the case Ulster Bank swap case:

    http://www.irishtimes.com/newspaper/finance/2012/0730/1224321085903.html

    What with IT issues (ever hear of Disaster Recovery Units?), mis-selling swaps and the parent being part of the trio that “cooked” the LIBOR rate, the bully-bank in the bowler hat and orange sash is not having the best July.

    Should get its marching orders!


    • on July 30, 2012 at 7:52 am namawinelake

      @WSTT, thanks for link. The only case on the Court Service for David Agar and Ulster Bank is one dated December 2010 so not sure where Suzanne is getting her “Mr Agar, whose property interests include the Harcourt building in Dublin, took the case against the bank earlier this month.”

      The issue does now appear to be on the Irish media radar at least, and it will be interesting to get comment from the Central Bank/Financial Regulator on the history and exposure to swaps misselling.

      The UK’s Telegraph has championed the issue and their banking correspondent Harry Wilson can be contacted on Twitter via @harrynwilson (there’s an “n” in the middle there!)


  8. on July 30, 2012 at 8:23 am JP

    Sam Morrison, the north’s biggest retail landlord and probably’s BoI’s biggest property client in the north, paid £8m to get out of one of his swaps.

    http://www.bbc.co.uk/news/uk-northern-ireland-18848630


    • on July 30, 2012 at 4:31 pm JP

      PBN, co-owned by Paddy ‘Golden Circle’ Kearney, have also been giving out about swaps:

      “The report added that in 2008, the banks effectively ordered it to commit to medium-to-long term fixed interest rates not long before the Bank of England began slashing its base rate.

      PBN said this cost them about £8.5m in 2009 alone – the sum total of the company’s losses in that year. ”

      http://www.bbc.co.uk/news/uk-northern-ireland-11940511


  9. on July 30, 2012 at 1:57 pm david gage

    gentlemen, firstly i would like to thank everyone who has contributed to this topic, we have issued legal proceedings aginst our bank (RBS) for the mis-selling of the IRSA, however distubingly it would appear that (RBS) are to appoint KPMG as the ”independent advisors” to the bank!! which frankly smells very dodgy!! our company found itself being put into admistration february 2012, and KPMG are the administrators and LPA recievers, !!! we have managed to HALT proceedings against our property holding company as the ruling from the FSA has allowed this, but i fear that the BANK and KPMG are firmly locked in together, so i fear no impartiality will prevail hear. its disgusting to think that we still live in an era, where we cannot trust the Banks.
    however i do think justice will endeavour, and i personally will stop at nothing to bring our bank to justice over thier greedy and criminal ways.

    DG


  10. on July 30, 2012 at 2:26 pm john gallaher

    Ulster Bank-looks like they are marching ahead,most likely maintain a presence in the north but last one out turn off the lights in the south !

    “Minister for Finance (Deputy Michael Noonan): I have been informed by the Central Bank that it has not received any formal application to change the regulatory or legal status of Ulster Bank Ireland Ltd from that of a subsidiary of Royal Bank of Scotland Group. However, there are some informal indications that Ulster Bank Ireland Ltd may change its regulatory status and be subject to regulation by the Bank of England and the UK Financial Services Authority as in the case of its parent, Royal Bank of Scotland.”
    http://debates.oireachtas.ie/dail/2012/07/12/00078.asp


  11. on July 30, 2012 at 2:52 pm who_shot_the_tiger

    I am trying to get a transcript of the case up to the point of the settlement in order to assess the arguments. I will also meet the barrister involved. However, it is hard to get details at this point due to the confidentiality of the settlement.

    The reporting seems a little off the mark. My feedback is that the bank sold a 40 million swap in excess of the loan and that the settlement required that the SWAP was torn up “ab initio”. Compensation was paid on that basis.

    I’m sure that the “chattering classes” will have the full details in a couple of days.

    Meanwhile, it couldn’t have happened to a nicer bunch of bankers with a “W”.


    • on July 30, 2012 at 4:21 pm namawinelake

      @WSTT, your criticism of the Irish media does indeed seem right on the mark,

      As far as I can see, no Irish (Republic) media outlet reported that last week, both AIB and Bank of Ireland have said they will allow the UK regulator to review their sale of interest rate swap products, but only in the UK apparently.

      “Allied Irish Bank UK, the Bank of Ireland, Co-Operative Bank, Clydesdale and Yorkshire banks, Northern Bank and Santander UK have all said they will allow the regulator to review their sales of these products.

      This coincides with the recent announcement on behalf of the UK’s big four banks, Lloyds, Barclays, HSBC and the Royal Bank of Scotland, which have reached a settlement agreement over the debacle.”
      http://www.compliancy-services.co.uk/fsa-authorisations/fsa-reveals-7-new-banks-open-to-rate-swap-scrutiny/2077

      It seems neither the Central Bank nor (Irish) Financial Regulator has a position on this issue other than it is a matter for the individual borrower to assert their rights, ultimately in court if needs be.

      This matter is beginning to appear on the periphery of the domestic political radar, and it is hoped there can be a blogpost on the subject later in the week.


  12. on July 30, 2012 at 2:58 pm john gallaher

    Any details on the receivership at Harcourt Street or “The Harcourt Building”,it was my understanding that a stay had been put in place pending the outcome of this part of the case.
    Looks like the Man Group has packed up too,over 10,000 sq.ft available for sub-let as of today,with a k/o in 15!
    “The first floor is held under a 25 year full repairing and insuring lease from the 1st April 2005 subject to a current passing rent of €577,572.60 per annum. The next Rent Review is due on the 2nd April 2015. The Lease contains a Break Option on the 31st March 2015. ”

    http://www.realestate.bnpparibas.lu/pages/actualites/fiche.php?s_code=ie_officemarket_The_Harcourt_Building&l=es&r=286&t=bnppre&ctx=0&s_wbg_menu=376&s_id=0


  13. on July 30, 2012 at 7:54 pm Pl Tell me I'm Wrong

    Thanks NWL yet again. More info in one post than a year of RTE.

    Hopefully pressure may build to force CB to look at the Spivs favourite form of legalised theft – Payment Protection Insurance. UK Regulator to its credit has at least been looking into it. Practices here were just as smelly – dealers dangling car loans in front of the young and foolish and slipping in expensive and often worthless PPI as part of the “deal”. Car dealers I know hated selling PPI, but the pressure was relentless.


  14. on July 31, 2012 at 2:16 am DCB

    JG, David Agar was more financially literate than many developers, he has no PGs

    Banks often sold long swaps, sometimes for 30 years, well in excess of the loan term, they were punted on the basis that the borrower was hedging against its refinancing risk, which was total bollox.

    The bank arranging the swap might make a c20bps annual credit spread, but the real cocaine high came from the accounting which allowed you to take the entire PV of this credit spread into your current year profit and loss.

    Two banks in the uk refused me credit for not taking out such swaps.


  15. on July 31, 2012 at 2:52 am john gallaher

    @DCB NWL is doing a post on this later in week,agreed Agar has publicly claimed numerous times that he has no PG’s.One aside to this case is the use of funds with conflicting reporting.But will hold back too many comments until NWL does his post,as they do take a lot of work and tend to be quite good !

    Indo-it was a non cash buy out.
    “The bank claims the property carried total debt of €33.8m by the end of 2005 when still jointly owned by Mr Agar and Mr Shovlin. In March 2005, it advanced €36m to Mr Agar to purchase the property outright from Mr Shovlin.
    It claims Mr Agar bought Mr Shovlin’s 50pc interest in a non-cash transaction whereby he exchanged his shareholding in another property-related company with Mr Shovlin in return for full ownership of the Harcourt property.”
    http://www.independent.ie/business/irish/ulster-bank-fights-developers-claim-it-wasnt-entitled-to-install-receivers-3032883.html

    Examiner-a little different !
    “Opening the case, his counsel Mark Sanfey said Mr Agar had a relationship with the bank going back to 2000. In 2005 he borrowed €36m to buy out his former partner’s stake in the Harcourt Building. The interest rates applicable for that loan was 3.84% for five years and 3.54% for seven years. ”
    http://www.irishexaminer.com/business/kfsnsnidcwql/rss2/

    He may have won this battle,but lost the war,regardless of ‘swaps’ the building at the center of this dispute is highly leveraged,expecting it to hit the market via receivers shortly.
    Finally on financial literacy…again from Examiner..je ne comprends!!!!
    “The case arises out of a number of interest rate swap products on loans Mr Agar entered into with Ulster Bank. He claims those products were recommended to him by the bank following a meeting in July 2007 but their effects were not explained to him. “


  16. on July 31, 2012 at 10:23 am Barry Mahon (@Cucuronaise)

    Would I be excessively naive in suggesting that swaps, whatever they are, should be banned?? I did notice that short selling was ‘suspended’ recently (again) – what not banned? or at least only allowed for banks who have spivs and bookies as clients?


    • on July 31, 2012 at 11:22 pm DCB

      Yes, they are at th basic level a good thing. The alternative is to borrow on a fixed rate loan were if rates move against you there is a loss if you repay early, just as there is on a swap, but if rates move in your favour and you repay on a loan with a swap you make a profit whereas under a fixed rate loan you would not make any gain, for borrowers simple swaps are better than the alternative.


      • on July 31, 2012 at 11:46 pm who_shot_the_tiger

        @DCB, There are many derivative interest rate hedging instruments. SWAPs are just one of many. However, they are the most profitable for the issuing bank especially as the banks (with the help of their auditors) chose to book all the projected annual profits in year one.


      • on July 31, 2012 at 11:49 pm DCB

        There are only swaps and options, every derivative is made up of just those two building blocks. Most derivatives, especially in Ireland, were simple swaps.


  17. on August 1, 2012 at 12:02 am John Gallaher

    @DCB we utilize defeasance if rates move against you.Never had a swap pushed at me from lender,offered it but not conditional.Most RE companies handle internally their interest rate exposure,independent of lenders,some hedged some did not bother.But CMBS were a much larger factor I think stateside.Non factor in Ireland but a few out off the UK,they were the only real game over here,off course most of them blew themselves up with lax underwriting.But it’s starting to pick up again.

    Click to access 01012005.pdf


  18. on August 1, 2012 at 12:09 am sf ca writer

    The point that even experienced commentators in Irish media are misleading people on is that someone buying CFD’s is not “hoping to buy shares off the radar” and is not hoping to buy shares at all as has been suggested. Taking ownership of shares is actually the worst case scenario.
    It might be bananas or banks… the point is not the shares but the gamble on the movement of the price.
    The gamble. Gambling. Just like horse racing.
    A whole different ball game from ownership of shares and voting etc.
    If I am wrong please set me straight. If am right please set RTE and TV3 straight.Is there Irtish for the word derivative?


    • on August 1, 2012 at 12:27 am who_shot_the_tiger

      @sf ca writer, You are right and the Irish media are ignorant of the true nature of CFDs. They are as you quite rightly point out nothing but a gamble of the price movement.


      • on August 1, 2012 at 1:08 am sf ca writer

        @wstt thanks, I heard an interesting interview on public radio today , someone said that educated people will often say ‘I am no good at math’ but never say ‘I am no good at reading’. the reality is we like to replace numbers with words, and are probably all better with math than we think,, plus there is an insidious monopoly of math skill among a few great often good minds. Anyway thanks for the ongoing education.


  19. on August 1, 2012 at 12:23 am who_shot_the_tiger

    @DCD, Yes they were – but that was because they were the most profitable for the issuing bank.

    There were also caps, collars, swaptions, futures, long hedges, short hedges, cross hedges, arbitrage, cash matching, duration and the minimum variance approach.

    With the exception of caps, none of these were used – too complicated for the Anglo and UB Treasury guys (most of whom didn’t pass inter maths) and not profitable enough.



Comments are closed.

  • Recent Posts

    • Test – 12 November 2018
    • Farewell from NWL
    • Happy 70th Birthday, Michael
    • Of the Week…
    • Noonan denies IBRC legal fees loan approval to Paddy McKillen was in breach of European Commission commitments
    • Gayle Killilea Dunne asks to be added as notice party in Sean Dunne’s bankruptcy
    • NAMA sues Maria Byrne and Graham Byrne in Dublin’s High Court
    • Johnny Ronan finally wins a court case
  • Recent Comments

    Wisemama on Eddie Hobbs’s US “partner” fir…
    Dorothy Jones on Of the Week…
    Sean Bean on Eddie Hobbs’s US “partner” fir…
    John Foody on Of the Week…
    Wisemama on Eddie Hobbs’s US “partner” fir…
    otto on Of the Week…
    Frank Street on Of the Week…
    Wisemama on Eddie Hobbs’s US “partner” fir…
    John Gallaher on Of the Week…
    John Gallaher on Of the Week…
    who_shot_the_tiger on Eddie Hobbs’s US “partner” fir…
    Sean Bean on Eddie Hobbs’s US “partner” fir…
    otto on Of the Week…
    Brian Flanagan on Of the Week…
    Robert Browne on Gayle Killilea Dunne asks to b…
  • Twitter Updates

    • Funniest case in Irish legal history? 1. ex-Cllr Fred Forsey convicted of RECEIVING a corrupt payment 2. developer… twitter.com/i/web/status/1… 4 years ago
    • Really looking forward to this at 9pm tonight, esp the first Garda on the scene. Well worth reading this background… twitter.com/i/web/status/1… 4 years ago
    • Tea time on the day the president of the ECB tells us we [in Ireland] are paying more interest on our loans than th… twitter.com/i/web/status/1… 4 years ago
    • “I am grateful for you to refer to Mr Sugarman...on the specific question of Unicredit, responsibility at ECB lies… twitter.com/i/web/status/1… 4 years ago
    • @JMcGuinnessTD now confronts ECB about "the honest whistleblower" @WhistleIRL and his disclosures of liquidity issu… twitter.com/i/web/status/1… 4 years ago
    • Details, including court documents of class action in New York against Ryanair and CEO Michael O'Leary.… twitter.com/i/web/status/1… 4 years ago
    • Draghi tells @paulmurphy_TD the ECB doesn't remove govts, the people do, that's democracy. Bet the people will be m… twitter.com/i/web/status/1… 4 years ago
    • Wow! Draghi says there is no net interest cost for the Anglo bonds whilst they're held by the Irish central bank. T… twitter.com/i/web/status/1… 4 years ago
    Follow @namawinelake
  • Click on date for that day’s posts

    July 2012
    M T W T F S S
     1
    2345678
    9101112131415
    16171819202122
    23242526272829
    3031  
    « Jun   Aug »
  • Blog Stats

    • 5,113,731 hits

Blog at WordPress.com.

WPThemes.


Privacy & Cookies: This site uses cookies. By continuing to use this website, you agree to their use.
To find out more, including how to control cookies, see here: Cookie Policy
  • Follow Following
    • NAMA Wine Lake
    • Join 1,326 other followers
    • Already have a WordPress.com account? Log in now.
    • NAMA Wine Lake
    • Customize
    • Follow Following
    • Sign up
    • Log in
    • Copy shortlink
    • Report this content
    • View post in Reader
    • Manage subscriptions
    • Collapse this bar
%d bloggers like this: