Does Yvette Know Her Granite from Her Elbow?
The Granite securitisation vehicle is causing the government a lot of confusion, it may even cause the LibDems to back out of supporting the government's nationalisation of the Crock. Yvette Cooper stated in the Commons debate definitively that Granite is not covered by government guarantees. "It is not being taken into public ownership and it is not, in fact, owned by Northern Rock, so it is not part of the taxpayer's exposure and has never been so."Compare and contrast that with the Treasury statement of 18 December, 2007: HM Treasury today confirms that the guarantee arrangements for Northern Rock plc described in HM Treasury's announcements dated 20 and 21 September 2007 and 9 October 2007 are being extended, at the request of Northern Rock plc, to the following unsubordinated wholesale obligations, whether now existing or arising in the future... all obligations of Northern Rock plc to make payments on the repurchase of mortgages under the documentation for the "Granite" securitisation programme.
That seems pretty clear. Looks like the lawyers are going to get rich out of this...
UPDATE : Something of a stewards inquiry in the comments as to the nature of the obligation - though no one has argued that there is no obligation - except Yvette when she said "it is not part of the taxpayer's exposure". Like Guido said, the lawyers could have some fees out of the argument.
UPDATE II : Northern Rock's Annual Report 2006, Note 22, Page 86 states that the Granite group of companies "are regarded as legal subsidiaries under UK companies legislation". Odd because they aren't really structured that way.
63 comments:
Brown claimed Northern Rock's mortgage book was worth £100billion but we now learn that £45billion of that is owned by Granite and NR only have £55billion on their books.
We have been conned by Brown on a breathtaking scale and the person conned most of all is Vince Cable who has been calling loudly for nationalisation without knowing the actual state of NR's accounts.
Is Cable now having second thoughts or is he going to try to bluff his way out of this?
As for Brown, he plumbs new depths of dishonesty and deceit with every day that passes.
BTW Where does Derek Wanless figure in all this?
Perhaps 'Protect Your Deposit' is something Yvette needs to bear in mind at the next general election ...
Why wasn't this crucial point probed, forensically, at PMQs. Instead of trying to score saloon bar debating points why doesn't Cameron go in with the scalpel?
Cut the girl at least some slack, Guido, it probably took her all morning to grasp what SPV stands for, let alone how the damn' thing works.
As any fule kno, these cod socialists are much better at pretending at pandering to their twizzler-fuelled man-made-fibre clad electorate than they are at the nuts and bolts of real business.
Wrong on this one - govt is guarenteing NR's GIK account not granite itself - ask one of your 'mates in the city' about it...
Wait a minute; this creature has no tits.
Still, if you count Ed and his brother there's two in the family already. So that's all right then.
Looks like Gordon really is in between a rock and a hard place.
This Granite thing has to be sorted out NOW!!! Brown, Darling and Cooper must NOT be allowed to Con the public. It is Beholden on Call me Dave to halt this piece of Legislation until each memmber of the public Knows exactly what they are getting for their £3,500
Just Another Venal Incomptent Labour Cunt. If Balls likes fucking that just imagine how much he will enjoy fucking us.
surely the Granite programme can just we wound down as mortgages are paid off?
Yvette's actually right here.
The Treasury guarantee covered NR's repurchasing obligations to Granite, not Granite's obligations to its bondholders.
NR's repurchasing obligations to Granite are very limited, and do not cover the vast majoriy of Granite's liabilities.
oh dear snotty what have you been doing, my sources say that morning meeting is a collection of bleary eyed ,and very nervous ministers.
whilst the house of lords does not make exciting televison , when the rock came bill in , it got a lot of stick and pretty much full backing for the ammendments .
one conservative lord , "with the contempt that this house has been treated the commons will be mistaken if it thinks this legislation will pass through unammended"
the national audit committe now want to look at the rocks books , turns out only branston got a look at them , not even the mangement team got a look .
when the house meets could well be fire lib dems now want the conservative ammendments and few of there own .
snotty will be burnt at the stake
the meps expenses is also causing trouble at labour hq some sort of intricate fiddle with organisations that were just bank accounts
gordons just ok the release of foreign prisoners early .the blokes just bonkers
ime getting the union jack out , wheres 45gov when you need him
All true socialists are football fans so they will be familiar with this phase:
"Yer don't know wot yer doin'! Yer don't know wot yer doin'!"
Granite is, as far as I'm aware, an SIV and not owned by NR. As it's not owned by NR, the assets that comprise Granite are unlikely to form part of the assets that are being subject to the government guarantees. NR may, however, have cash at hand from the sale of assets into Granite.
The assets at hand will be the balance sheet lending, of whatever size that is.
NR owns a chunk of Granite, so has a liability.
The underlying assets of Granite are NR mortgages to which it has legal obligations.
Methinks Yvette is talking a load of Balls....i hope she didn't swallow.....or has been seriously misinformed, in line with standard NuLaB spin and propaganda policies.
Granite looks like an SIV. Whoever put the money into Granite, will have surely demanded garrantees from Northern Crock, that should defaults occur Crock will make up the difference.
Crock may have default cover, but from whom and are they any good, as the mono line insurers are all falling apart.
Also why give Crock immunity from F o I, what's in there, that is so smelly.
At a guess,the securitisation agreement with Granite never envisaged the collapse and nationalisation of the Wreck.As a result no-one will put their heads above the parapet and give a definitive answer because there isn't one.
Just as in times past, a Labour government will come to a sticky end having completely screwed up the public finances and sold taxpayers down the river in a sequence of interlinked scandals each one more expensive than the last.
A detailed analysis was provided by a fellow blogger back in the Autumn. Yvette, Alistair and Cyclops should have read it:
http://www.taxresearch.org.uk/Blog/2007/09/17/northern-rock-the-questions-needing-answers/
This incompetent shower should be held to account. I sat through the third reading of the bill to nationalise NR and although no-tits gave a strong performance, evading critical questions from the opposition of course, she had great boots albeit pasty chunky knees at the dispatch box. Im pleased I sat through this farcical bill with interest, the highlight for me was Bill Cash’s articulate interpretation of the bill with some minutes to midnight to go. During which, no-tits trotted back into the chambers with her tail between her legs only to be followed by blinky-balls with an expression on his dour face; “that’s my bird, that is”!
Good on Cable to pursue this important matter as it transpired live in the commons, it is apparent that this bill is far from transparent and many questions are yet to be answered with many points of order to be resolved. What has become crystal clear is the shocking incompetence of the treasury, deceit and desperateness of the government.
New Labour - they can't even fuck it up properly!
Oh dea!
First is was Granita. Now it is Granite.
Three of Northern Rock’s non executive directors including former Resolution chief Paul Thompson are set to exit the lender as newly appointed chairman Ron Sandler moves to name his own board of directors.
Thompson will depart along with 3i Group managing director Michael Queen and Sir Ian Gibson, who have both been on the Northern Rock board since 2005.
Chairman Bryan Sanderson is also set to depart after taking the reins last October after the resignation of former chairman Matt Ridley.
According to reports, non executive director Simon Laffin, Paul Devaney, Laurie Adams and finance director Dave Jones will remain at the group.
The moves come amid growing controversy over Granite, the bank's special purpose vehicle used to securitise around £45 billion of its mortgages. The Lib Dem and Conservatives claim the Jersey-based company owns the higher quality mortgages, leaving the tax payer backed nationalised bank with lower quality assets. Prime minister Gordon Brown emphatically denied this yesterday.
Granite is a SPV (not a SIV which is an off balance sheet financing vehicle al la Enron).
Granite sits right in the middle of Crocks balance sheet as a liability in the form of "securitised notes". It is the tax efficient securitisation vehicle into which the Crock securitises mortgage debts into debt securities and then flogged them off to investors. Its the reason Crock ran out of money as no-one would buy these "Retail Mortgage Backed Securities" due to the credit crunch. No cash, no bank!
Why are are media class and politicos surprised by the use of Granite and what it is? Every bank in the Western world uses securitisation to manage their funding. It would not be a surprise to anyone with even a basic 101 knowledge of the banking industry which clearly that excludes our politicians and media and sadly the 1st secretary to the Tresury. City Unslicker probably knows more about this than me.
T Blair must be laughing his head off. Brown's Law must surely now be written in Granite: you reap what you sow.
Brown & Darling decide their course of action over NR in 5 months.Then the House of Commons have to decide on the course of action in a few hours without proper knowledge of what they are deciding.
What a farce.
That's a fucking giraffe not a bird, no wonder her cunt of a husband is called Blinky, all that neck and no head or tits, he woudn't know which way round she was -oh, just right for this lot, interchangeable with Mandelscock.
There will be no end to the revelations of thieving, lying and incompetency until this bunch are kicked out.
RDS, getting the Union Jack out won't help - the queer snot-gobbling rocking-horse rider has already wrapped his putrid carcass in it. The cunt is letting violent foreign criminals out because he needs the room for OAP veterans who haven't or won't pay their council rip-off. You don't see the First Letter-Box QC defending their rights. Perhaps she'll have an earner out of NR.
Why on earth are you all still paying council tax, and for the state propaganda machine - do you want this lot for ever? They don't intend to let themselves get voted out, you must realise that, and short of someone telling Madge that it's time to earn her crust, the only answer is civil disobedience. The cunts won't last five minutes without YOUR money.
INTERESTING INFORMATION
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http://ftalphaville.ft.com/blog/2008/02/21/11087/national-granite/
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http://companyinfo.northernrock.co.uk/downloads/securitisation/granite%20trust%20reports.pdf
GRANITE FILINGS
-------------------------------------------------
This creepy looking boy holding the board has three hands!
The Telegraph explains the problem succinctly - the issue is that the security provided to Granite in the form of mortgages has to be maintained at a level of around 110% of face value, or there is a default. Thus, as mortages are paid off (e.g. when someone switches to another provider), other mrtgages have to be allocated to Granite as security.
This would be 'OK' if the Wreck were operating normally - but it isn't underwriting much new mortgage business, and has to be shrunk to meet EU / UK competition law and state aid requirements. So the assets left in NR will shrink and the Government's risk of loss will rise. I would put a bet on the final cost being between £15bn and £20bn... at best £10bn.
Problem is that banks have us over a barrel, given systemic risks - answer (but imperfect) is much tougher regulation, which will need to be implemented internationally (or will get race to the bottom), and passing costs of failure to banking sector, not taxpayers.
Bottom line is that FSA f*cked up badly - that's the real story. The Bank refused to do what other countries are doing (hence the anti Merv spin last Oct), which is bailing out banks through hidden transactions, whilst forcing them to take on new capital from Sovereign Wealth Funds. Question is whether latter would really have wanted a piece of the Wreck - probably not. So Bank was probably right to resist...
OT, but I hope everyone has signed the petition to stop the Archcunt Bliar from becoming Mr President, and the fat slag being the 1st Letter-Box of the EUSSR.
www.stopblair.eu
Guido, does 'Pigs in Shit' do MEP's
Criminal abuse' of expenses by Euro-MPs
http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2008/02/21/neu121.xml
If you're thinking of widening your scope to include that trough, getting a couple of extra porkers might be advised. Shouldn't think a mere three would be merited for this lot.
abb "Every bank in the Western world uses securitisation to manage their funding." Absolutely.
Been used to my certain knowedge since the early-mid Eighties, so around for at least 25 years. The Tuscan was fortunate enough to have Countrywide Credit Industries (*ooops*) as a client in the early 90s; many happy days going round Annandale (and Selsdon Park nr Croydon oddly enough) with Angelo Mozilo, with both of us usually over 100 including mulligans.
Angelo was the first to develop the concept of a pureplay mortgage securitisation business. A very canny chappie.
Tuscan Tony & the rest.
Uh oh theres a big f*cking problem here!!! Sorry missed it earlier...
Granite exists to securitise mortgages and sell 'em off to investors. The government wants to run down Crocks mortgage book to reduce taxpayers liabilities. Er, if there is no or a reducing mortgage flow into Granite, the securitisation model for Granite is now at risk. If Granite defaults, who is on the hook? Surely the government (i.e. the poor taxpayer yet again) will have to cover this one off? Otherwise the lawyers will get very good business from a large number of Granite bondholders.
Consider this. The RMBS instruments that Granite issues will be embedded in all kinds derivatives. What impact would a Granite default have on the CDO and CDS markets? Is the FSA on top of this one?
Granite could be an orphan i.e. NOT owned by Northern Rock. I understand orphans are often owned by charities to whom the tiny profits made are passed. I have heard though that some orphans are not owned by charities but by more commercially minded shareholders/benficiaries who ensure that a commercial fee is charged by the orphan for its services. I wonder what the position is with Granite and, if the latter, who its shareholders/beneficiaries might be. This is a question the Conservatives should raise or does the FOI apply to Granite?
Excellent analysis on HousePriceCrash
http://www.housepricecrash.co.uk/forum/index.php?showtopic=68813
If these guys can figure it out, how come Notits Cooper couldn't?
At least the freedom of information gag is an obvious tactic by the government: they're utterly clueless as to how the Crock is structured and what the liabilities are. This way they don't have to answer any hard questions.
I've just seen Brown on TV at a press conference in Europe. Is he ill? He looks like death warmed up. Have they got him drugged up? Mumbling, stumbling over his words, disinterested, miserable. What's his problem?
Let's face it. Nu Lab MP's can not (or claim not to)understand simple Mortgage loans, expense claims and donations. What F in chance have they got with Northern rock's creative book keeping?
Call Me Dave should call Vince, then they should call their Lords and put a stop to this whole sorry affair until Brown comes clean and fesses up as to what exactly the Tax payer is in for.
Is Northern Rock a pyramid scheme for banks, which can only operate in times of plenty of liquidity?
We all know that pyramid schemes for savers is one of the oldest tricks in the book, so surely we have not fallen for the banker's version.......
There's no question that Yvette Cooper is the most androgynous MP in the House.....she looks like a little boy.....aha! The penny's just dropped.
An off topic Government initiative, heard on the BBC.
Lie in bed scratch arse this morning and on come fucking Government Today programme with young parent John Farmer and twittering Jock literati, Toilets McNaughtie. Some fucking guttural, gabshite Scotch MP for a Labour-tyrannised shithole constituency, full of battered wife; drunken, illiterate, cross-dressing sectarian thug and fried Mars Bar outlets says Drink Is Too Cheap, The Noo.
Nigel Griffiths, Tartan Cocksucker Pursuivant to the Great Visionary, says that ye cannae have they weans getting all this cheap booze cos it leads them into the ways o’ the Divil instead of into soul-destroying minimum wage slavery or, as the GV would say, active participation in the great British democratic, Eye Dee carded, shoot on site, tap-your-fucking-phones, no more wogs here only rich ones, hospital death camp, pension-free, underwater, plague-ridden, up to your arse in debt, ponced-upon, plague-ridden, bankrupted society. Aye, it’ll be under-age drinking that’s fucking everything up. Down with AlcoPops.
Tommy getting his unprotected arse shot off, foreign gangsters running the banks, everyone’s pension down the fucking toilet, yes, Stanislav blame cheap lager for all this shit. Blame anybody but fucking government of useless thieving lying bastards like Griffiths, never done a days fucking work, good for fuck all tossers shitting in taxpayer face. Horrible gang of repulsive ugly misfits, crones and hags, Ainsworth, Blears, Flint, Schmidt, Millibuggers, Ballses; Christ have Mercy, such nightmare persons, such greedy grotesquery; contemptible, utterly unprincipled, utterly incompetent and the whole rotten, cankered ship of fools rudely captained by the brooding, bullying, menacing and thoroughly unwholesome NappyNancy living in a world of snot-eating, nail-biting, father-dominated, delusion and fantasy and paranoia. Yes, you are right; put up the price of Kestrel.
This idiot-cunt, Griffiths, claims that Tesco is subsidising the cheap lager, that it’s a loss leader, as though, under freemarketeers NewLabour, retailers should not do such things. What a prick, in order for his idol - the lost leader - to stand up and bluster about growth people have to sell stuff and as long as TESCO keep to the licensing regulations - and they do, far more so than your average whoreson publican - is none of his fucking business what they charge.
On the subject, though, of subsidised drinking being harmful, the hideously unprepossessing, spluttering gabshite Griffiths will, of course, undertake not to drink in any of the Commons’ many subsidised bars, so dutifully provided by the shit-spattered taxpayer. When Commons groupie, bon vivant, raconteur, moralist and homme des letttres, Mr Jerry Hayes, invites Griffiths, winningly, for a G&T or when the drunken, red-faced ginger bore Jock Kennedy in his short-back-and-sides haircut offers a cheap Highland malt, Griffiths will, of course, decline. Or at least offer to pay the proper price.
Out here in radio land, listening to this shit, Stanislav wondered why in no other place of public sector employment but the house of commons can employees not only do their work pissed out of what they are pleased to call their minds, but actually get their poison bought for them by those in whose faces they are shitting, those whom they reprove and admonish and chide and hector and bully and steal from, Mr & Mrs Speaker.
Never ye mind under-age drinking, Griffiths, get your tongue frae the prime minister’s arsehole and hie ye hence to the BBC and tell the electorate exactly why legislating for the nation, raising taxes, starting illegal wars and stuff, is such a trivial matter that you fucking bastards can do it - at my expense - pissed oot o yer wee minds, shouting and bawling and brawling like the horrible pisshead turd Jock Reid; why is it that you can carry on, day after day, like you were at a Glasgow wedding? Never mind a few drunk teenagers, they’re not the problem, you are, you fucking miserable nit-picking, cheeseparing, hairsplitting, idle, thieving, racist, warmongering, despicable fucking hypocrite. Go on Griffiths you phony prick, go on the BBC and tell us why you should get pissed on the job and have subsidised booze - as well as all your other scams and deceptions - but Joe Public should not even enjoy a bit of a loss leader down the supermarket. Cunt.
all the good mortgages are in granite and all the shite is on rocks books.
what a fukin clown gordon brown
If Granite is a Black Hole then its back to the IMF followed by resignation of Broon and Darling.
Oh dear, oh dear.
Granite is a bog standard securitisation vehicle / SPV. It is highly likely to have first dibs both on the assets and on the bank itself for its investors (buyers of its securities), in order to secure the high ratings for the bonds it issued. From this useless government's point of view it is a case of 'Doh!' rather than a dark swizz, as the Standard suggested it was yesterday.
NR bill defeated in the lords!
I've just been listening to Wee Wendy on FMQ on television - it's hilarious. Her first question to Alex was about cuts by the SNP council in Aberdeen. Shots of Alex showed his grin broadening as the question progressed. When she finally stopped, Alex pointed out that the council there was actually a Liberal, not SNP led one, and that she should direct her question to Nicol Stephen. She seems to have as much of an idea of Scottish politics as she has of truth and honesty - that is absolute zero. I'm becoming more and more convinvced that she is an SNP secret agent, out to destroy the Labour Party!
Lords seem to have just voted that the Crock will be subject to FOI - against the governments wishes. (164 to 133)
Granite does have all the good assets. Plus it has a right to call in all loans if these are not replenished quick sharp.
This vehicle will likely have to be liquidated, maybe without too much loss as it has all the good stuff. That then just leaves a nice small business with a load of crappy loans.
Here is a nice slideshow on what securitisation really is. timely really.
Anon 11:42 thx for the steer. The boys and girls on this blog won't like it coz the guy exhibits a conscience but he's hit the nail right on the head.
See this link to his blog http://www.taxresearch.org.uk/Blog/2008/02/20/northern-rock-you-cant-not-nationalise-granite-because-it-has-no-existence-apart-from-northern-rock/
Of ocurse Granite is an SPV (and why do we have SPVs? to hide something). So what is McBean-Broon-Stalin's darling glove puppet trying to hide?
Granite also has debts but if we say they are not part of NR then they're off balance sheet and we keeps our master happy don't we precious.
Only hope Vince briefs his master as the boy George seems to be out of his depth on this one.
stanislav
cankered ship of fools ruddely captained by the brooding, bullying, meanacing and thoroughly unwholseome nappy nancey
class stan class
glad lords are concerned , hope gordos back from brussels and faces the music , should be a very interesting commons session.
jaqui smith has done a statement on bugging , no offence commited , best bit was when vaz asked if transcripts/audio copies would be made available. mc nulty later went on to rubbish labour speak , how charitable .
The link to 'Annual Report 2006, Note 22, Page 86' doesn't work: '404 page not found'.
Thank you Uncle Rob, fixed.
Oooops
Looks like the padded bra has slipped....
'Spose she heed three hands to grab all those fucking expenses!! Grrrr
Read somewhere that Mandy thinks that after a somewhat shaky start "Gordon is now firmly in the saddle."
WHAT can he be meaning?
Is she a Hermaphrodite ? cos that ain't no woman.
Obligations is a well defined technical term meaning the underlying security - bond, cdo whatever. All obligations means all securities that woudl lose value if NR had a credit event (bankruptcy etc). QED
Trying to understand GICs and SPVs in one day is going to be far too much for your financially illiterate commentariat.
I dont understand how cars work but I dont demand that we return to the horse and cart when a few thousand people are killed in car accidents every year.
what a (c)rock this thread is.
Guido you can be a "legal subsidiary" but still be "bankruptcy remote" which is what the Granite SPV is. This isnt even an SPV issue but occurs with many companies and their legal subsidiaries. There is no other type of subsidiary since we are only interested in discussing things that are defined in law.
Ruth Kelly, Patricia Hewitt, Yvette Bollocks, Sheree Bliar, Sarah McBroon, Bendy Wendy, Hazel Blears, Vera Baird, Tessa Jowell - suffering succotash, no wonder all these ZaNuLab pricks bat for the other side or switch-hit. Mandelscock is the prettiest of the bunch by far since he lost the 'tache.
Shut that door!
Bravo Bravo!
Stanislav; that was MAGNIFICENT!
Yep, Stan that was a masterpiece!
I don't wish to be unkind but yvette cooper
looks like a spastic in that photo.
Ironic that the fragrant Yvette is holding a campaign placard from a homeless charity when she and Mr Ed do so well out of the MPs' housing allowance jackpot.
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