Friday 11 May 2012

Ferrari as collateral for €2k??

A Dublin property developer goes to his bank for a 10 day loan of €2k.

Following the opening stance, the bank manager offers the loan at 10%  annual, + a little extra for admin, i.e. €57, effectively 104% interest, and requests security.

The property developer offers his new €450k Ferrari parked outside, hands over the keys, takes the cash and leaves the bank. The bank manager parks the car in the bank's underground car park, and later jokes with the staff about the €450k car being used as security for €2k…

Ten days later the property developer returns, repays the €2k + €57 interest, picks up the keys and is about to drive off when the bank manager asks why he was prepared to use such an expensive asset as security…and received the reply 'Now where in Dublin could I get 10 days secure parking for €57?

Moral: The same deal can have different values for each party in a negotiated agreement…

Have a dealerious weekend, from the NamNews Team!

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