Pepper Group may be bought out

A financial services company from Australia has received €436 million offer to takeover from KKR, a New York private equity firm.

 

It is not KKR’s first time entering the Irish market. Pairing up with the Ireland Strategic Investment Fund they set up a €500 million fund to finance the residential property development.

 

KKR bought Avoca Capital back in 2014, a credit investment manager in Europe located in Dublin, that was managing €7.05 billion of assets at the time.

 

Now they are looking at taking over the Pepper Group. Pepper entered the Irish financial services market about 5 years ago by buying GE’s Capital’s Irish mortgages.

Pepper has spread throughout Ireland ever since they bought around €600 million of subprime mortgages during the height of the financial crisis. Buying them at 40c on the euro which was backed by Goldman Sachs, a Wall Street …

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How Do American Mortgages Work? Part 9: The Financial Crisis

What caused the Housing Bubble in the United States during the early 200s? Experts’ continuous debate on what the root of the cause is but Fannie Mae and Freddie Mac have less to do with it than you think. Fannie and Freddie backed about half of all the home-loan originations in 2002 but a new market for mortgage-backed securities were arising. Loan originators backed by Wall Street were straying away from selling the loans to Fannie and Freddie but creating their own mortgage backed securities with high-risk subprime mortgages. These would include something called a hybrid adjustable-rate mortgages with balloon payments which are nearly impossible to sustain without refinancing. It left Fannie and Freddie only backing up around 30% of the loans in 2005 and 2006.

The big players of Wall Street like Lehman Brothers and Bear Stearns would package the subprime loans into securities. The credit-rating agency would then rate them falsely-high so they can sell to investors who were unaware of the actual health of the security. Everyone saw how the housing prices were rising and didn’t see …

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Jim Rogers, David Frost interview

Jim Rogers talks to Sir David Frost about the role of Government and Central Banks in the current crisis, he believes that the ethos of ‘not letting anybody fail’ actually magnifies problems because doing this means the bubble continues to inflate far beyond the size it would have done otherwise.

Jim has a very simple and straightforward way of explaining things that make him ever popular, although some of the medicine he prescribes is considered quite harsh. His point about letting the market do what it must is of the libertarian strain and for all anybody knows, he may be right (right as in ‘correct’ not as in ‘wing’), if so then everything being done to counteract the crisis is the inverse of what we should be doing.

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The Banks want to issue a slap on the wrist to those pesky HedgeFunds!

Irish Banks are considering legal action against several hedge funds in the belief that they gave false information about them in order to drive down their stock price and therefore make money by short-selling their stocks. If the regulator didn’t hammer the banks for the several million euro that the Irish Consumers were ripped off of in various debacles from account fees to forex charges then why should they get involved in this row?

The Regulator is there to enforce proper conduct in the Irish market, if the hedge-funds in question are not based here (chances are their administration might be though) then they will have little recourse, further more, the Irish Banks should be levied more if the Regulator does get involved, Irish Financial institutions have to pay for 50% of the Financial Regulators budget requirements, if they are going to be called in as inter-company police then the levy on firms using them for that purpose should increase. …

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