Sunday, March 27, 2011

Ireland Update: Stress Tests, New ECB Liquidity Facility, and ... bondholder haircuts?

by Calculated Risk on 3/27/2011 07:29:00 PM

The next round of Irish bank stress test results are due on March 31st. Meanwhile the ECB is seeking a new liquidity facility and Ireland is talking haircuts for senior bondholders ...

• From Bloomberg: Ireland Seeks to Share Bank-Loss Burdens With Bond Holders, Noonan Says

Ireland wants to share bank losses with senior bondholders as part of a “final solution” for the country’s debt-laden financial system, Agriculture Minister Simon Coveney said.

Finance Minister Michael Noonan will seek agreement from European authorities to share losses with bond holders after stress-test results on March 31 determine how much extra capital the banks need, Coveney said.
• From the Financial Times: Ireland seeks ECB deal to secure banks
• From the WSJ: ECB Seeks New Liquidity Plan for Irish Banks
the Sunday Business Post newspaper reported over the weekend that the tests will expose a capital shortfall of €18 billion to €23 billion. That is more than the €10 billion earmarked by the European Union, International Monetary Fund and European Central Bank in Ireland's November bailout deal, but less than the €35 billion many analysts had estimated the banks would require.
Yesterday and Today:
• Here is the Summary for Week ending March 25th.
• Lawler: Census 2010 and Excess Vacant Housing Units
Schedule for Week of March 27th