Posts Tagged ‘Economic Woes’

Goldman Sachs analyst: Greece may need $198bn bailout

An analyst at Goldman Sachs has forecast that Greece may require a total of €150 billion ($198 billion) in bailout funding for its economy to remain operational.Earlier this month, a provisional deal was agreed between the country, the International Monetary Fund (IMF) and other eurozone member states to provide Greece with €45 billion.But Erik Nielsen, chief European economist for Goldman Sachs, has warned this figure is nowhere near high enough to tackle Greece’s economic woes, reports the Guardian.”On my numbers, a one-year fully funded program needs to provide a minimum €50-55 billion, an 18-month program will require some €75 billion, and a three-year program a minimum €150 billion,” he said in a note to investors.”I reckon the latter number is out of reach even for the present political environment of generosity, so the debate is between €55 billion and €75 billion.”Mr Nielsen added that he believes that representatives from the IMF and the eurozone will already be debating how they will share the burden of delivering more financial aid.He said he does not reckon it likely the eurozone countries will be able to come up with much more cash than the €30 billion they have already pledged to hand over to Greece.Mr Nielsen went on to speculate that the IMF may be able to place together an additional funding program based on either providing €55 billion over the course of a year or €80 billion across an 18-month period.Earlier this week, German finance minister Wolfgang Schauble warned that it is not yet certain the eurozone will provide the initial €30 billion of funding Greece is expecting.He said that the provision of aid is dependent on Greece coming up with a detailed plot on how it intends to cut its budget deficit in the next few years.

Police raided the headquarters of Anglo Irish Bank in Dublin yesterday morning

Countdown to raid on Anglo:May 2007 Anglo Irish Bank’s shares peak at more than €17 each July 2008 A so-called “golden circle” of ten investors secretly buys a 10 per cent stake in the bank September 30 Government unveils a €400 billion guarantee scheme for six banks, including Anglo Irish December 18 Sean FitzPatrick, the chairman, resigns and admits he hid more than €80 million in secret loans from shareholders Decemeber 19 David Drumm, the chief executive, resigns December 21 Government recapitalises Anglo with €1.5 billion December 29 Shares plummet to 12 cents January 15, 2009 The Government is forced to nationalise Anglo January 16 Shareholders call for the board to be sacked January 19 Five board members resign February 10 Irish Life & Permanent’s €7 billion deposit to boost Anglo’s balance sheet is revealed February 20 Donal O’Connor, the new executive chairman, reveals that it gave loans worth €451 million to ten customers last year to buy shares in the bank.

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