Spain And Finland Reach Collateral Deal

Tyler Durden's picture


Animal Farm rears its European head, where we learn that some bailout agreements are more subordinated than others. Bloomberg brings us the details of the just completed collateral deal between Finland and Spain, which has terms identical to that of Greece, where there was absolutely no debate about whether bailout loans were senior to public and private sector debt. Following this deal the semantics of the ESM subordination, implied or explicit, should also end.

  • Collateral deal bilateral between Finland, Spain, Finnish Finance Minister Jutta Urpilainen spoke to reporters.
  • Deal structured as Greek collateral was
  • Other countries not asking for collateral - YET!
  • Collateral to come from deposit guarantee fund
  • Negative pledges mean deal can’t be directly with state

So courtesy of bullet point 4 we learn that Finland is right in seniority as Spanish depositors. And one Spanish bonds pass 7%, then 8% and so on, every other country will seek the negative pledges we discussed back in January, and demand exactly the same conditions as were just granted to Finland. It is just a matter of time.

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Tue, 07/17/2012 - 09:46 | 2623929 zero19451945
zero19451945's picture

How exactly are you going to collect on the collateral?

Tue, 07/17/2012 - 09:59 | 2623966 Bicycle Repairman
Bicycle Repairman's picture

Send in the Finnish navy, and the people who say "NI!!"

Tue, 07/17/2012 - 13:05 | 2624779 falak pema
falak pema's picture

the Wisigoths will be back in Spain!

Tue, 07/17/2012 - 10:02 | 2623985 Sudden Debt
Sudden Debt's picture



Tue, 07/17/2012 - 11:17 | 2624343 Nothing To See Here
Nothing To See Here's picture

I can't resist the picture of Vikings coming to claim their due and finding something akin to Greece's finance ministry basement...

Tue, 07/17/2012 - 11:42 | 2624464 cossack55
cossack55's picture

The prudent Finns could use a large chunk of the Costa Del Sol for wintering over.

Tue, 07/17/2012 - 10:26 | 2624098 NJBDeflator
NJBDeflator's picture

I just wrote an article about Spain's new austerity called "The First Cut"

Tue, 07/17/2012 - 09:47 | 2623933 Nothing To See Here
Nothing To See Here's picture

Spidey towels getting a 2nd life?

Tue, 07/17/2012 - 09:49 | 2623936 KNiCKER
KNiCKER's picture

"Collateral to come from deposit guarantee fund"



Tue, 07/17/2012 - 09:54 | 2623955 malikai
malikai's picture

Gave me a chuckle too. I wonder who advised them on this deal.

Tue, 07/17/2012 - 09:58 | 2623967 LeBalance
LeBalance's picture

a slimy squid trail was seen at the meeting location.

Tue, 07/17/2012 - 10:12 | 2624030 Txo
Txo's picture

Bwaahahahahahha !!!!    AAhahahahahhahahaah ... Vikings got played.

Tue, 07/17/2012 - 09:52 | 2623950 hugovanderbubble
hugovanderbubble's picture


DEAL HAS TO BE APPROVED NEXT 19th in Finnish Parliament.

Tue, 07/17/2012 - 09:55 | 2623960 sudzee
sudzee's picture

This should work out OK since there will be no deposits to guaratee.

Tue, 07/17/2012 - 10:03 | 2623991 Temporalist
Temporalist's picture

Spain and Finland Reach-Around Deal

Tue, 07/17/2012 - 10:08 | 2624012 youngman
youngman's picture

It only shows the politicians got a does not matter if there is no meat behind the looks good on paper...

Tue, 07/17/2012 - 10:10 | 2624025 butchee
Tue, 07/17/2012 - 11:43 | 2624469 Yohimbo
Yohimbo's picture

Ill gladly pay you tommorrow for a hamburger today 

Tue, 07/17/2012 - 12:14 | 2624580 silverserfer
silverserfer's picture

" I'll trade you 13 of my dingleberries for a vial of your diahreah and a poop squirt"

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