the global financial crisis - impact on irish banks and regulations
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Electronic Assignment Cover sheet
Students Number :
Maria Petronela Toma 1642529
Magdalena Maria Grzes 1645065
Course Title: MSc International Banking and Finance
Lecturer Name: Enda Murphy
Module/Subject Title: International Financial Institutions and Markets
Assignment Title: The Global Financial Crisis – Impact on Banks and Regulation
No of Words: 3172
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Contents
Abbreviations ...................................................................................................................................... 3
The Global Financial Crisis – Impact on Irish Banks and Regulation ....................................................... 4
1. Introduction .................................................................................................................................... 4
2. The impact on Irish banks ̀ liquidity, profitability and solvency .................................................... 5
3. The managerial shortcomings in banks and the deficiencies in bank regulation ......................... 9
4. Irish Government Interventions in Financial Markets .................................................................. 12
5. Conclusions ................................................................................................................................... 14
References ........................................................................................................................................ 15
Appendices ........................................................................................................................................ 18
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The Global Financial Crisis – Impact on Irish Banks and Regulation
Abbreviations
AIB Allied Irish Bank
Anglo Anglo Irish Bank
ATM Automated Teller Machine
BIS Bank for International Settlements
bn billion
BoI Bank of Ireland
CB Central Bank of Ireland
EBS Educational Building Society
ECB European Central Bank
EU European Union
FR Financial Regulator
GDP Gross Domestic Product
GNP Gross National Product
IL & P Irish Life and Permanent
IMF International Monetary Fund
INBS Irish Nationwide Building Society
NAMA National Asset Management Agency
OECD Organization for Economic Co-operation and Development
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The Global Financial Crisis – Impact on Irish Banks and Regulation
1. Introduction
The economy of Ireland has changed in recent years from an agricultural focus to a
modern knowledge economy and transformed itself from one of Europe‟s poorest countries
into one of its wealthiest, earning itself the nickname “Celtic Tiger” (The Guardian, 2009).
The boom started in the late 1980s and brought rising investment and growth in employment
and household formation, this economic miracle being widely admired and emulated (Central
Bank, 2010, p. 20-21)
Once with the 2008 global financial crisis, the Irish economy has been one of the
worst-hit euro-zone economies due to the high exposure of the banking sector to the property
market and the boom associated with that over the recent history (Mayer Brown, 2009, p. 1).
In early January 2009, a Irish Times editorial stated that: “We have gone from the Celtic
Tiger to an era of financial fear with the suddenness of a Titanic-style shipwreck, thrown
from comfort, even luxury, into a cold sea of uncertainty” (The Irish Times, 2009a).
The collapse of the building boom left Irish banks facing large losses to builders and
developers. Despite denials by the banks that they faced any difficulties, their share prices
started to slide steadily after March 2007. The crisis came to a peak on 29 September with a
run in wholesale markets on the most aggressively expansionary of the Irish banks, Anglo-
Irish. (Kelly, 2009)
Nearly 15,000 financial service providers are authorized by the Irish Financial
Regulator with over 80 authorized credit institutions (Financial Regulator, 2009). The main
retail banks in Ireland are Allied Irish Bank (AIB), Bank of Ireland, Ulster Bank, National
Irish Bank, Permanent TSB and Bank of Scotland (Ireland).
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The purpose of this paper is to investigate the global financial crisis in Ireland and the
impact it had on its banks and regulation. The paper is divided in five sections: the first part
briefly presents the economic context, the following section shows the extent to which the
global financial crisis has impacted bank liquidity, profitability and solvency in Ireland. The
third section analyzes the extent to which managerial shortcomings in the Irish banks, and
deficiencies in bank regulation, have contributed to the financial crisis. The fourth section
presents the Irish Government interventions in financial markets to stabilise banks and
prevent disorderly failures and the last part summarizes the findings and provides a
conclusion.
2. The impact on Irish banks ` liquidity, profitability and solvency
The Basel Committee of Banking supervision defines funding liquidity as the ability
of banks to meet their liabilities, unwind or settle their positions as they come due (BIS,
2008). In other words, liquidity refers to banks‟ funds, funds that mostly consist of customer
deposits and various bonds and which are used for their daily operations, such as filling
ATMs or issuing loans. Solvency is the ability of a business to have enough assets to cover its
liabilities. Banks can become insolvent if they suffer big losses on their assets (mortgages,
loans or government bonds) and are obliged by law to hold certain reserves of capital in order
to avoid insolvency.
A bank manages the risk that too many of its lenders will look for their money all in
the same time by holding cash reserves, and by using the money markets for short-term
borrowing. According to the Governor of the Irish Central Bank (Central Bank, 2010,
P.121), Irish banks, for fifty years, had no difficulty in accessing any short term funding
needed, thus never had to deal with liquidity problems, but starting with August 2007, and
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especially with the events of September 2008, the access of banks worldwide to short-term
borrowing became very constrained, as risk aversion and uncertainty rose. Governor
Honohan also argues that putting a solvent but illiquid bank into bankruptcy is an
unnecessary cost for the society, and this is when emergency liquidity assistance from the
central bank becomes necessary. However, the main difficulty is determining whether the
bank is solvent or not.
Before the 2008 crisis hit, there were no major concerns about the health of the
banking sector. In 2006, IMF stated: “Financial institution profitability and capitalisation are
currently very strong, with Irish banking sector profits amongst the highest in Western
Europe. Reflecting their good performance, the major Irish banks receive upper medium to
high-grade ratings from the international ratings agencies.” (IMF, 2006, p.5)
Starting with 2007, some liquidity concerns emerged, but they were not considered
major threats to the banking system. According to Honohan, although a Liquidity Group was
established by the Central Bank in early 2008 to obtain information on liquidity
developments from the main credit institutions and to identify any potential problems at an
early stage, a comprehensive picture of the actual liquidity flows had not been put in place
before early 2009. During 2008, the liquidity situation deteriorated, as reflected in the
unprecedented recourse to financing from the European Central Bank which rose from a
monthly average of around €6 billion in September 2007 to €20 billion in September 2008.
(Central Bank, 2010, 116-117)
In early September 2008, the diminishing access of banks to liquidity became the
urgent focus of attention for Central Bank. Anglo Irish Bank was the most vulnerable but the
Central Bank considered the problem essentially one of liquidity rather than of solvency.
In the following paragraphs, the situation of the profitability, liquidity and solvency in
the three most problematic Irish banks is discussed.
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Anglo Irish Bank
Anglo is a property-focused commercial lending bank that accumulated more than
€100 billion in assets by September 2008, helped by a substantial reliance on wholesale
funding. (Standard & Poor, 2011a)
In August 2008 Anglo Irish Bank released an Interim Management Statement that was
in line with expectations that the company`s earnings would rise 15% for the full year to
September 30th. Anglo stated that the economic environment would remain significantly
challenged, but according to Fitch Ratings Anglo„s long-term rating at A+ remained stable.
(Central Bank, 2010, p.162)
In just a month, the situation of the bank changed entirely with the fall of the property
market and the wholesale funding market dislocation, leading to the bank`s nationalisation in
January 2009. Since 2009, Anglo has been making important losses. The bank reported at the
end of March 2010 a €17.7 billion loss, the largest in Irish corporate history (Reuters, 2010)
bringing its cumulative loss to €30.4 billion since October 2008. The 2010 result reflected a
loan impairment charge of €19.3 billion, which, according to Standard & Poor (2011a)
clearly exceeded Anglo's €1.8 billion operating profit that came largely from a one-time €1.6
billion gain on the repurchase of its own hybrid securities (see Table 1 in Appendices).
As a result of the losses, Anglo has been heavily reliant on capital support from the
Irish government, and in order to avoid insolvency and collapse, the bank was nationalized in
December 2008, when the Irish government announced plans to inject €1.5bn of capital for a
75% stake in the bank. (The Telegraph, 2008)
Anglo and Irish Nationwide Building Society experience liquidity issues and therefore
are entirely dependent on the Irish central bank for future funding via its Emergency
Liquidity Assistance program (see Table 2 in Appendices). At the beginning of July 2011 the
legal merger of the INBS business into Anglo took place.
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Bank of Ireland
Over the past years Bank of Ireland's performance has also been severely affected by
the consequences of the sharp falls in property prices, the general dislocation of the wholesale
funding markets, and specifically weak investor appetite for exposures to Irish banks.
Through the crisis time, BoI has benefited from significant government support: capital
injections, the purchase of BoI's weakest property-related loans by the National Asset
Management Agency, and access to liquidity from the monetary authorities. Standard &
Poor`s (2011b) states that the liquidity support was most evident through the third and fourth
quarters of 2010 when BoI, like many domestically owned Irish banks, saw a marked outflow
of wholesale deposits.
Standard & Poor`s (2011b) calculated the bank`s pre tax loss at €3,442 million for
2010, compared with an underlying pre tax loss of €2,839 million for the nine months to end-
2009. Even with the weakest loans having been transferred to NAMA and anticipating a
continued tight focus on operating expenses, S&P expects BoI's earnings through 2011 and
2012 to continue to decrease (see Table 3 and Table 4 in Appendices).
AIB
In August 2008, AIB released the results for the first half of the year, which were
generally in line with expectations of pre-tax profits of just over €1.3 billion for the first half
of 2008, up 8.6% on the same period of 2007, but the bank announced it expects earnings per
share to decline by 8-10 percent instead of the previous growth. (Central Bank, 2010, 161-
162)
By the end of 2008, the situation of AIB`s profitability reversed. According to
Moody`s (2009) the 2008 operating profit after provisions for impairment was reduced by
62% to 862 million euro, compared to 2007. Moody`s saw a weakening trend in AIB`s
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profitability and a neutral trend in its liquidity. AIB`s liquidity was impacted by its growing
reliance on market funding, which decreased in 2008, reducing the bank`s loan to deposit
ratio at the end of 2008 to 142% from 158% in 2007. (Moody`s 2009)
3. The managerial shortcomings in banks and the deficiencies in bank
regulation
As capital adequacy and risk management go to the core of the operations of a bank,
the ability of directors to understand the internal governance of banks is critical in order to
exercise sound judgment about the affairs of the bank. (Kostyuk, Takeda, Hosono, 2010,
p.79) These requirements are reflected in the Basel Committee on Banking Supervision„s
principles of corporate governance for banking organizations (BIS, 2006). The Basel
Committee emphasised that poor corporate governance risk may lead to the bank losing
market confidence, which may further lead to a liquidity crisis or trigger a bank run.
According to Kostyuk, Takeda, Hosono (2010) this resonates in the Irish context as poor
governance was a contributory factor to the situation which emerged in the case of Anglo
Irish Bank in 2008 and early 2009 prior to and subsequent to nationalisation.
In Ireland, the management of all banks lost awareness of the riskiness of their
portfolios, assuming that prices could only go on rising or, at worst, stabilise. The best
example of mismanagement of Irish financial institutions was Anglo Irish Bank, which
through aggressive property lending had gone from an insignificant merchant bank in the
1990s to the joint-second largest bank by 2007. The two large retail banks, AIB and Bank of
Ireland came under pressure from analysts to match the profits and growth of Anglo Irish.
(Kelly, 2009, p.23)
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The chairman Sean FitzPatrick, CEO David Drumm, and board member Lars
Bradshaw of Anglo Irish Bank, all resigned in December 2008, following the revelation of a
loan scandal (RTE, 2008). FitzPatrick and Bradshaw took out loans in order to purchase
Anglo Irish shares. From 2000 – 2008, FitzPatrick transferred the loans to another bank prior
to year-end audits, therefore causing "Loans to Directors" to be understated. In 2008, the loan
to FitzPatrick and Bradshaw reached €87 million but the transfer resulted in the accounts
showing only about €40 million outstanding to directors, instead of €150 million. The head of
the Financial Regulator, Patrick Neary was pressured into resignation in January 2009, as
financial authorities failed to prevent this behaviour.
On 12 February 2009, details of a further controversial transaction misrepresenting
the accounts of Anglo-Irish Bank became public. Anglo-Irish Bank lent €4bn to Irish Life &
Permanent (IL&P) for 1 day as an inter-bank loan, and a subsidiary of Irish Life placed a
deposit of a similar amount with Anglo, which was recorded as a customer deposit.
Following a discussion with the Minister for Finance, a board meeting of IL&P accepted the
resignation of two senior IL&P executives. (The Irish Times, 2009b)
Moreover, a related concern is the practice of Irish directors to hold a number of
simultaneous directorships in major companies. Grant Thornton Corporate Governance
Review (2009) gives a few examples, of which the Chairman of Anglo Irish Bank who was a
director of four other Irish listed companies. Similarly, directors of AIB and IL&P were also
the directors of four other Irish listed companies, this practice being inappropriate at times of
crisis.
Although the Irish financial regulatory system was perceived as robust and modern,
the Irish banking crisis has brought to the surface its shortcomings (Kostyuk, Takeda,
Hosono, 2010, p.81). Nyberg (2011) considers that the Central Bank and the Financial
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Regulator was aware of the risks but appear to have judged them insufficiently alarming to
take major restraining policy measures.
An OECD report suggests that the supervisory issues that contributed to the Irish
banking crisis were two-fold (OECD, 2009, p.36). Firstly, the corporate governance issues at
Anglo Irish Bank and the facilitation of the transfer of the loans to other credit institutions
suggest that the threat of enforcement by the Financial Regulator was too weak. Secondly, the
OECD (2009) suggested that excessive lending growth was tolerated by the Irish Financial
Regulator despite very high asset growth being a well-established predictor of banking
difficulties. In addition, the OECD suggested that the Irish Financial Regulator failed to
recognise the full impact and the riskiness of the decisions taken by each financial institution.
Nyberg (2011) considers there was a general state of denial in the Central Bank,
where the belief in a soft landing was consistent and probably continued up until and
including the crisis management phase. “The problems in Anglo and INBS in particular, were
not hidden but were in plain sight of the FR and the CB. The funding strategy of Anglo was
obvious from its balance sheet and the concentration to the more speculative part of the
market was generally known. Similarly, INBS‟s expansion into development lending was
also clearly documented and the governance problems in the bank were widely known by the
authorities.” (Nyberg, 2011, p.vii)
According to Nyberg (2011), neither the Central Bank nor the Department of Finance
seem to have considered the implications of a possible interruption in the flow of foreign
funding. The Department of Finance and the Minister for Finance were regularly provided
with a Financial Stability Report, written by the Central Bank and the Financial Regulator,
report that did not warn about the serious risks the banks could face because of this bubble.
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4. Irish Government Interventions in Financial Markets
Since September 2008 the Irish Government has had to intervene significantly in the
banking sector in a myriad of ways. These have included guaranteeing the Irish banking
sector, nationalizing and restructuring distressed banks, creating an entity to manage impaired
assets, and providing capital injections (see Table 5. in Appendices) (Cussen and Lucey,
2011, p. 84).
State guarantees:
In September 2008, the Irish Government advertised a state guarantee that intended to
save the Irish banking system. The Irish State guaranteed for the deposits, senior debt and
dated subordinated debt of participating Irish credit institutions for the period until 29
September 2010. The State covered liabilities include retail and corporate deposits, interbank
deposits, senior unsecured debt, covered bonds and, subject to certain restrictions,
subordinated debt (see Figure 1. in Appendices) (Nyberg, 2011, p. 77). Liabilities covered
initially amounted to €352 billion, which was equivalent to almost three times the value of
Irish GDP (Cussen and Lucey, 2011, p. 83). The Irish state covered under the deposit
protection scheme for banks and buildings societies form up to a maximum of €100,000 per
qualifying deposits per institution.
Capital injections:
In late December 2008, the Irish Government decided to support a recapitalization
program for credit institutions through the National Pension Reserve Fund. Since 2009, up to
October 2011, the Irish authorities have provided the banking sector with capital injections
amounting to €64 billion. (Cussen and Lucey, 2011)
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In 2009 the Irish State provided two Irish banks, Allied Irish Bank and Bank of
Ireland, with capital injections of €3.5 billion each. The largest capital injections were
provided to Anglo and INBS. During 2010, capital injections to Anglo and INBS totaled
€25.3 billion and €5.4 billion (Cussen and Lucey, 2011, p. 82).
European Commission (2011) summed the capital injections into Irish banks during the
crisis, as of 28 January 2011, to €46.3bn (29% of GDP) as follows:
Anglo Irish Bank -Total: €29.3bn (18.3 % of GDP)
Allied Irish Bank (AIB) - Total: €7.2bn (4.5% of GDP)
Bank of Ireland - Total: €3.5bn (2.25% of GDP)
Irish Nationwide Building Society - Total: €5.4bn (3.5% of GDP),
EBS Building Society - Total: €0.9bn (0.5% of GDP)
National Asset Management Agency (NAMA):
In early 2009, the Irish Government announced a further government initiative
concerning establishing an asset management company, the National Asset Management
Agency. The Agency has acquired portfolios of property loans from banks operating in
Ireland in return for issue of Irish government bonds to the banks. These government bonds
are intended to enable Irish banks to access liquidity and provide credit to the Irish economy
over an extended period of up to ten years (NAMA, 2010, p. 2). The purchases would be
funded by NAMA issuing debt securities, 95 per cent of which were guaranteed by the Irish
Government (Cussen and Lucey, 2011, p. 85).
Public ownership of banks:
By the end of July 2011, the Irish State had provided €64 billion of capital to the six
Irish banks. These large capital injections mean that most of these banks are now owned by
the State. In January 2009, Anglo was the first bank to pass into public ownership, followed
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in the middle of 2010 by EBS and INBS, and at the end of 2010 by AIB (Cussen and Lucey,
2011, p. 87). At the beginning of 2011 Anglo and INBS merged into a single company
renamed the Irish Bank Resolution Corporation (IBRC).
5. Conclusions
During the boom years the Irish banks experienced continuous growth and
profitability, followed after September 2008 by a free fall. They lost liquidity, went from
huge profits to huge losses and some were even threatened with insolvency. Although the
crisis had been building for 18 months, the government and financial regulators appear to
have been taken entirely by surprise. The authorities were obliged then to take unpopular
measures in order to safeguard the Irish banking system, injecting billions in some banks
from the taxpayer`s “pocket”.
The purpose of any business is to make profit by taking risks, but the group thinking
and herding, which were common amongst banks, made them not see the risks they took as
threatening, at any point. The financial institutions were blinded by success, and we think that
none of them wanted to even take in consideration the risks, because of the fear that they will
lose the race towards higher profitability. The fear of losing the entire business was
somehow forgotten and replaced with the “fear” of not taking enough advantage of the
infinite opportunities to make huge profits that were on the market.
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Appendices
Table 1: Anglo Irish Bank Corp. Ltd. Asset Quality, Funding and Liquidity Ratios
-Year-ended Dec. 31-
(%) 2010 2009 2008 2007 2006
Gross nonperforming assets/customer loans plus
other real estate owned
45.8 29.6 1.3 0.5 0.5
Net nonperforming assets/customer loans plus other
real estate owned
24.7 10.9 0.1 0.1 (0.0)
Loan loss reserves/gross nonperforming assets 61.2 70.9 95.5 88.1 102.7
Loan loss reserves/customer loans 28.1 21.0 1.3 0.4 0.5
New loan loss provisions/average customer loans 14.5 20.9 1.3 0.3 0.2
Net charge-offs/average customer loans 0.7 0.1 0.1 0.1 0.0
Customer deposits/funding base 17.1 35.3 56.4 61.3 60.1
Total loans/customer deposits 326.4 265.7 144.4 128.9 134.8
Total loans/customer deposits plus long-term funds 164.3 150.2 100.0 84.7 93.7
Customer loans (net)/assets (adjusted) 36.0 66.1 71.2 68.3 67.1
Source: Standard & Poor`s, 2011a
Table 2: Anglo Irish Bank Corp. Ltd. Profitability Ratios
-Year-ended Dec. 31-
(%) 2010 2009 2008 2007 2006
Net interest income/average earning assets 0.9 1.7 2.0 2.0 1.9
Net interest income/revenues 161.7 179.6 97.3 88.8 85.9
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Fee income/revenues (14.2) (21.0) 6.8 9.1 10.7
Market-sensitive income/revenues (14.8) (56.7) (5.3) 1.1 2.2
Personnel expense/revenues 28.3 22.6 10.6 13.3 16.9
Noninterest expenses/revenues 57.5 40.5 16.9 22.3 26.4
New loan loss provisions/revenues 1,692.2 1,779.2 45.3 8.5 5.3
Pretax profit/revenues (3,838.6) (1,511.8) 40.4 70.5 68.3
Tax/pretax profit (0.2) 0.9 15.3 18.9 22.6
Noninterest expenses/average adjusted assets 0.3 0.4 0.3 0.5 0.5
Pretax profit/average common equity (457.5) (309.5) 19.2 36.9 39.0
Source: Standard & Poor`s, 2011a
Table 3: Bank of Ireland Asset Quality, Funding and Liquidity Ratios
-Year-ended Dec. 31-
(%) 2010 2009¶ 2008* 2007* 2006*
Gross nonperforming assets/customer loans plus
other real estate owned
10.7 10.9 4.7 1.1 1.1
Net nonperforming assets/customer loans plus other
real estate owned
6.8 6.9 3.5 0.7 0.8
Loan loss reserves/gross nonperforming assets 39.3 39.2 27.8 39.4 30.9
Loan loss reserves/customer loans 4.2 4.3 1.3 0.4 0.3
New loan loss provisions/average customer loans 3.5 4.0 1.1 0.2 0.1
Net charge-offs/average customer loans 0.6 0.1 0.2 0.0 0.0
Customer deposits/funding base 47.6 56.3 51.4 52.0 46.2
Total loans/customer deposits 183.8 158.8 163.0 158.1 173.6
Total loans/customer deposits plus long-term funds 124.4 109.5 113.8 108.1 134.7
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Customer loans (net)/assets (adjusted) 73.3 75.2 71.8 72.9 71.3
*Financial year ended March 31 of the following calendar year. ¶Nine months to Dec. 31, 2009. Ratios annualized where
appropriate. N.A.--Not available. N/A—Not applicable. N.M.--Not meaningful.
Source: Standard & Poor`s, 2011b
Table 4: Bank of Ireland Profitability Ratios
-Year-ended Dec. 31-
(%) 2010 2009¶ 2008* 2007* 2006*
Net interest income/average earning assets 1.4 1.7 2.0 1.8 1.6
Net interest income/revenues 71.9 78.3 89.3 70.9 65.2
Fee income/revenues 13.1 8.4 12.6 15.7 19.0
Market-sensitive income/revenues (4.4) (0.8) (9.5) (5.7) (1.5)
Personnel expense/revenues 35.0 30.3 30.7 29.1 32.0
Noninterest expenses/revenues 62.2 53.2 54.7 50.7 55.5
New loan loss provisions/revenues 157.8 155.7 39.3 5.5 2.6
Net operating income before loan loss
provisions/loan loss provisions
23.9 30.0 115.4 902.6 1,680.6
Net operating income after loan loss
provisions/revenues
(120.0) (109.0) 6.1 43.8 41.9
Pretax profit/revenues (33.1) (69.5) (0.2) 45.5 50.3
Tax/pretax profit 35.9 19.0 585.7 11.8 15.6
Core earnings/revenues (103.1) (92.8) 6.2 38.6 35.5
Core earnings/average adjusted assets (1.8) (1.8) 0.1 0.9 0.8
Noninterest expenses/average adjusted assets 1.1 1.0 1.1 1.2 1.3
Core earnings/average risk-weighted assets N.M N.M 0.4 1.4 1.3
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Core earnings/average adjusted common equity (76.0) (81.8) 4.6 30.4 30.6
Pretax profit/average common equity (%) (22.7) (76.5) (0.1) 28.8 31.6
*Financial year ended March 31 of the following calendar year. ¶Nine months to Dec. 31, 2009. Ratios annualized where
appropriate. N.A.--Not available. N/A—
Not applicable. N.M.--Not meaningful
Source: Standard & Poor`s, 2011b
Table 5: Timeline of Irish Government interventions in the banking sector
Date Event Amount % of GDP
2008 Guarantee of the banking sector €352 bn guaranteed 191.7
2009 Nationalisation of Anglo Irish Bank nil Nil
2009 Capital injections into BoI €3.5 bn 2.2
2009 Capital injections into AIB €3.5 bn 2.2
2009 Capital injections into Anglo €4 bn 2.5
2010 NAMA established €28.7 bn guaranteed 18.6
2010 Capital injections into Anglo €25.3 bn 16.4
2010 Nationalisation of EBS and INBS nil Nil
2010 Capital injections into EBS €0.875 bn 0.6
2010 Capital injections into INBS €5.4 bn 3.5
2010 Restructuring of Anglo and INBS nil Nil
2010 Capital injections into AIB €3.7 bn 2.4
Source: Cussen and Lucey, 2011, p. 81
1 The % of GDP calculations are calculated by reference to the GDP of each year. These are: €179.99bn for
2008, €160.60bn for 2009 and €155.99 bn for 2010.
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Figure 1: Covered Banks – Liabilities Guaranteed by the State at 30-Sep-2008 (Nyberg,
2011, p. 77)
Source: Nyberg, 2011, p. 77
Dated
SubordinatedDebt, €12.2 bn,
3%
Customer
Deposits,
€173.2 bn; 47%
Financial
Instruments,
€0.7 bn; 0%
InterBank
Deposits,
€49.1 bn; 13%
Asset Covered
Securities, €15.8 bn; 4%
Senior
Unsecured Debt,
€124.2 bn; 33%