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Ecb Raises Concerns About Rights To Irish Bank Collateral

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http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8212987/ECB-raises-concerns-about-rights-to-Irish-bank-collateral.html

It suggested in a position paper posted on its website that Ireland's bank rescue package could affect its ability to provide funds in support of the eurozone financial system.

It said: "The ECB has serious concerns that the draft law is insufficiently legally certain on a number of critical issues for the Eurosystem".

The ECB said in the paper that the problems of legal uncertainty include "the scope of collateral rights of central banks given as security against emergency liquidity assistance".

It is the ECB's role to ensure it holds enough collateral to reduce its exposure in the event of some of the funds it provides not being paid back.

The paper serves to highlight the ECB's uncertainty about providing further liquidity to the Irish banks. The banks already have €136bn (£115bn) in loans from the ECB, a quarter of all Eurozone loans, and €45bn in emergency liquidity assistance from the Irish central bank.

http://www.ecb.int/ecb/legal/pdf/en_con_2010_92_f.pdf

I'm guessing it's this paper that's being referred too?

http://www.ecb.int/home/html/index.en.html

List of most recently released papers from the ECB.

So it would appear the ECB is getting worried it might have accepted turds as collateral for loans. Genius have doubts about the quality of paper after you accept it.

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http://www.bbc.co.uk/news/business-12036433

The European Central Bank has expressed concerns that the Irish Republic's 85bn euro ($112bn; £72bn) bail-out package could affect its ability to provide further support to eurozone members.

The bank said possible flaws in the Irish bail-out legislation could compromise its ability to provide collateral for future funding.

It said it had concerns over the quality of collateral to cover loans.

On Friday, credit rating agency Moody's cut sharply the Republic's debt rating.

"The ECB has serious concerns that the draft law is insufficiently legally certain on a number of critical issues for the euro system," the bank said in a position paper published on its website.

The paper reflects the bank's concerns about the quality of the collateral it holds in case any loans made to the Republic are not paid back.

BBC gave the link to the paper which was the one that I picked as the source for the Telegraph article.

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http://www.telegraph.co.uk/finance/financetopics/financialcrisis/8214488/Euro-falls-amid-continuing-debt-crisis-fears.html

The euro dropped to a two-week low against the dollar after the European Central Bank warned it had "serious concerns" about the laws governing Ireland's bail-out of its banking system.

The comments followed credit rating agency Moody's decision to slash Ireland's credit rating last week.

Investors also turned to German government bonds as a safe haven, sending the price up and the yield below 3pc for the second day in a row. The gap between the yield on German government bonds and their Irish and Portuguese equivalents widened.

The euro was down 0.2pc to $1.3158 in lunchtime trading, after falling as low as $1.3125.

The yield on 10-year German government bonds was 3pc, compared with 8.65pc on Ireland's 10-year bonds.

Still it could be worse.

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http://www.telegraph.co.uk/finance/financetopics/financialcrisis/8214933/Allied-Irish-Banks-moves-7.9bn-property-loans-to-countrys-bad-bank.html

Allied Irish Banks has handed over property loans worth €9.3bn (£7.9bn) to the country's bad bank as the lender's debt was downgraded along with that of many of Ireland's other major banks.

Allied transferred the loans to the National Asset Management Agency, the state-controlled toxic debt holder, at an average discount of about 60pc to the face value of the debts.

The transfer came as ratings agency Moody's followed up last week's five-notch downgrade of Irish sovereign debt with the downgrade of most of the country's large financial institutions.

Debt issued by Allied, Bank of Ireland, EBS Building Society and Irish Life & Permanent was marked down by between three and five notches by Moody's. The ratings agency added that further downgrades could follow and put a "negative" outlook on the banks' debt.

"Moody's expects that, over the foreseeable future, Irish banks are likely to continue to face very difficult conditions in the wholesale markets and will therefore continue to rely on central bank funding," said the ratings agency.

What are they all worried about Ireland's just put all it's turds together and fixed everything.

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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