AIB never said we had to pay the loan back!
The quintessential defining moment of recent Irish economic history has just occurred; six family members are suing AIB on the grounds that the bank has no legal right to demand repayment of €25.3 Million these folks borrowed. Wow. This is a special moment.
Wouldn’t you love to get terms like that from your bankers? But before we all get too excited about what you or I might do with 25.3 million yo-yos, let’s stand back for a moment and think about it. Now, if you’re Bill Gates, or Warren Buffett, 25.3M might be just barely enough to get your attention, but for the rest of us, that’s a fair bit of dosh.
The Irish government recently cut a vaccination plan to save 12M from the national coffers, and that was headline news. Perhaps a 12M cut in government spending would not be major news in the UK, or the US, but we are small. We have an economy the size of Manchester, 25.3M is a LOT of money, in our national context. It’s enough to fund X-thousand much needed hospital beds — or the building of 84 brand new state-of-the-art schools — or 12 trade missions to China plus seed funding for a dozen new start-ups — or its enough money to once and for all develop a viable source for wave energy, which would make Ireland the major energy supplier for Western Europe.
Realising the many, much more socially relevant, uses to which that much money could have been put is exactly what makes this AIB loan fiasco so fascinating.
The bank loaned the money on — what for it! — yes, that’s right, a property development deal! A deal which has gone belly up, to the great surprise of no one, save perhaps a few AIB bank mangers, and 6 members of the Lynch family.
The music stopped, and AIB found itself 25.3M lighter, and holding a box full of tulip bulbs… oh, I meant, 86 acres of derelicts and dirt in Kilbarry, Waterford.
You don’t even know where Kilbarry is, do you? Don’t worry, the bankers who loaned the money probably don’t know either. But if you feel the need to get in on the action, relax, you can still pay twice the per acre price that the Lynch family negotiated — a single acre of Mixed Use & Opportunity Site situated on the Kilbarry Road adjacent to the City Council Landfill is on offer for €600,000! That’s right, ONE acre within smelling distance of the town dump can be got for a mere 600K. Wow. Just when you thought the bubble had pooped.
