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Portugal Agrees Asset Sale In Return For €78Bn Bail-Out

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http://www.telegraph.co.uk/finance/financialcrisis/8493240/Portugal-agrees-asset-sale-in-return-for-78bn-bail-out.html

Stakes in companies including TAP, the national airline; Galp, the oil giant; EDP, the utility firm; and REN, the electricity grid operator, will all be sold over the next two years. BPN, the failed Portuguese bank, will be sold with no minimum price set by the end of July.

The conditions of the package, that were revealed on Wednesday following the agreement announced late on Tuesday night by José Sócrates, Portugal's caretaker prime minister, also focused on rescuing the banks. About €12bn of the total €78bn must be pumped into the banking sector and to boost core tier one capital levels from 8pc to at least 10pc over the next 18 months.

......

Portuguese bond yields fell to their lowest level for five months amid general relief at the announcement of the bail-out. The cost of insuring Portuguese sovereign debt against default also fell. Five-year credit default swaps were down 25 basis points at 6.2pc , according to data monitor Markit. However, the yield on 10-year Portuguese bonds remaining above 10pc.

So the bankers now get to plunder the assets, and with the price of the 10 year above 10%, it would appear the market still thinks Portugal will default at some point.

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The interest rate on the loans will be set by European finance ministers at a meeting within the next couple of weeks.

Be interesting to see what this rate will be.

I bet Enda is frantically dialling Jose's cellphone as we speak :D

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http://www.nytimes.com/2011/05/05/business/global/05portugal.html?ref=business

Portugal was forced Wednesday to offer higher rates to sell short-term debt, suggesting that investors were still nervous about the country’s finances even after its caretaker government agreed with international creditors on a rescue plan.

The bond auction, which raised €1.1 billion, or $1.6 billion, came after José Sócrates, the Portuguese prime minister, announced Tuesday night that he had agreed to terms for a €78 billion loan package from the European Union and the International Monetary Fund.

Under the three-year financial assistance package, €12 billion will be channeled as fresh capital to Portuguese banks that have been shut out of the financial markets for more than a year because of investors’ concerns about Portugal and other suffering euro economies, according to a draft of the agreement published on the Web site of Expresso, a Portuguese magazine.

Slightly different take from the NY Times.

So the ECB has been funding the Portuguese banking system as well then? Does that also mean that Portugal has been funding it's deficit by the back door like the Irish did with there banks?

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Sorry, but where does it say that?

It does not need to, as soon as there are sales of large companies investment banks get involved for the fees to fund the bonuses. Private equity may even buy some of these companies to stuff them full of debt to pay bonuses and the lawyers will be circling like vultures.

Do you know that when Brown saved the banks, the banks and the lawyers charged us 150mill quid for advice. It was those fxckers that caused themeselves to go bust and then charged the taxpayers 150million to allow us the pleasure of saving them.

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In the subtext, see the small print :P

If the bankers don't provide the funding to buy the assets who else will?

So they're not actually going to "plunder the assets" then. They are going to "provide the funding to buy the assets". That's quite different isn't it?

Have you been on a Daily Mail headline writing course or something?????? :D:D:D

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So they're not actually going to "plunder the assets" then. They are going to "provide the funding to buy the assets". That's quite different isn't it?

Have you been on a Daily Mail headline writing course or something?????? :D:D:D

Not yet but I'm applying to go on the course, the fees are only £9000000000 a year :P

I'm just being flippant.

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Not yet but I'm applying to go on the course, the fees are only £9000000000 a year :P

I'm just being flippant.

:D

And I'm just grouchy this evening, as MrT has just told me....

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  • 309 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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