It's not just business, it's personal
The banks are now calling in personal guarantees given by developers on loans, writes Ronald Quinlan
Published 03/01/2010 | 05:00
THE personal guarantee: everybody who was anybody gave one to keep the money coming from the banks while the boom went on.
Developers, financiers, restaurateurs, nightclub impresarios and a range of other businessmen from across Ireland's entrepreneurial classes all signed agreements in which they variously promised to surrender personal assets -- up to and including the keys to their family homes -- in the event they were unable to service the loans they had taken to build their empires.
Popularised by Anglo Irish Bank at the height of its arrogance, and adopted willingly by the country's traditionally more conservative lenders, the guarantees were intended to "focus" borrowers' minds on achieving their goals while always meeting their obligations to repay their loans.