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Ireland Problem Assets Pollution Euro By Lanbo Jiang

  in Business | Published 2012-01-22 05:29:23 | 136 Reads | Unrated

Summary

Bank of Ireland, Europe held the hands of companies, individuals and governments at all levels of the large number of loans, bonds and other debt Ireland is not a State issue, the whole euro area will inevitably be dragged down

Full Content

Bank of Ireland, Europe held the hands of companies, individuals and governments at all levels of the large number of loans, bonds and other debt. Ireland is not a State issue, the whole euro area will inevitably be dragged down. According to BIS data, as of March 31, Ireland, the European banking sector exposure up to 650 billion U.S. dollars total.

Among them, the British banking sector most affected. According to BIS data, as of March 31, the Bank of England on a range of Irish institutions about 222 billion U.S. dollars exposure, equivalent to exposure to the whole world abo
ut a quarter of Ireland. In addition, Germany has a larger impact on the banking industry, their exposure to thepanies, individuals and governments at all levels of the large number of loans, bonds and other debt. Ireland is not a State issue, the whole euro area will inevitably be dragged down. According to BIS data, as of March 31, Ireland, the European banking sector exposure up to 650 billion U.S. dollars total.

Among them, the British banking sector most affected. According to BIS data, as of March 31, the Bank of England on a range of Irish institutions about 222 billion U.S. dollars exposure, equivalent to exposure to the whole world about a quarter of Ireland. In addition, Germany has a larger impact on the banking industry, their exposure to th Irish nearly 206 billion U.S. dollars, of whom 460 million was for the Irish banking sector exposure.

Fears that the Irish banking problems may be conducted to the debt crisis in Portugal and Spain, the more vulnerable members of the euro area. One of Europe's largest economy into a crisis if Spain will greatly weaken the ability of Europe's rescue, and a serious threat to the euro. EU Council President Rompuy 16 will be done off the Irish crisis, the euro area described serious events of life and death.

Irish international rescue plan to develop the European finance ministers want the British to the Irish bilateral loans, as the larger part of a rescue plan. The plan may be to scale up to 1,000 million euros, including the euro and the International Monetary Fund to provide credit.

Irish Government by the end of September, said the rescue could cost its top five banks 50 billion euros, the fiscal deficit will shoot up this year to gross domestic product of 32%, public debt will account for 100% of GDP. By the announcement of the Irish government bonds interest rate then soared. Ireland has been straight year Treasury interest rate of 9%, the German government bonds interest rates three times over the same period.

Negotiations are still ongoing rescue

Eurozone finance ministers from 16 member countries agreed to cooperate with the IMF, to the Irish banking rescue plan the basic structure, but the Irish authorities must decide whether to apply for assistance.

IMF spokesman for the 16 in a brief statement, said the Irish Government should request an IMF team will work with the European Commission and European Central Bank to hold a brief special consultation to determine the necessary assistance to the Irish, the best way to eliminate market risk .

However, in the face from the markets and the pressure within the EU, the Irish into a serious debt crisis in the 16 finance ministers Monday night's monthly regular meeting of euro zone countries did not request relief mechanism starts, but the relevant preparatory negotiations already under way.

EU Economic and Monetary Affairs Committee members Olli Rehn in a press conference after the meeting, said the Irish Government's commitment and the European Commission, the European Central Bank and the IMF launched the "short", "concentration" consultations to determine the available necessary to help the best way to address market risk, especially in the Irish banking sector crises.

In 2011 the Irish government insists does not exist before the middle of the funding gap, it does not need outside help, but its banking sector is indeed facing a grim situation, you need to counter it. 16 Irish Prime Minister Brian Cowen reiterated in the parliament, the Irish failed to put forward applications for assistance to any organization, but he admitted that some people want Ireland to apply for assistance. He said that the euro area we are ready with the appropriate body to collaborate, to see how we can make market conditions return to normal.

Slogan of the market to ignore maintenance of stability

Irish financial problems of the cause for concern. An Irish government in the hands still held cash reserves of 20 billion euros, at least before the middle of next year is still sufficient to repay all existing debt principal and interest; two Irish government has announced a large-scale debt relief plans, the deficit will fall to 2011 GDP, 10%; three Irish GDP share of the 16 countries in the euro zone less than 2%, in the "European Financial Stability Fund" under the auspices of the Irish government bonds have transgressed the covenant is still not in danger.

However, this market-sensitive nerves are not ignored, the recent debt problems of the Irish quickly became an international topic.

Portugal as the market worried about the country the next crisis. Portugal 2009 deficit-GDP ratio as high as 9.3%, just below the euro area in Ireland, Greece and Spain.

21pbn

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