All posts in Practice News

09 Jan 2015

State’s holding in AIB increases by €1.7bn in value

The value of the State’s holding in AIB rose by €1.7 billion in 2014, according to the latest valuation carried out for the National Treasury Management Agency. This has emerged from the NTMA’s review for last year. The State’s holding in AIB and Bank of Ireland is managed by the Ireland Strategic Investment Fund, which has taken over the role of the National Pensions Reserve Fund.

The valuation was carried out by EY, the auditors to Anglo Irish Bank at the time of its collapse and nationalisation in 2008-09. This values the State’s ordinary and preference shares in AIB.

At the end of 2014, the AIB holding was valued at €11.7 billion while the State’s 14 per cent stake in Bank of Ireland, which has a main market listing on the Irish Stock Exchange, was worth €1.4 billion. The State also holds €1.6 billion worth of contingent capital notes in AIB, also known as CoCos.

08 Jan 2015

Government borrows €4bn from bond markets at record low rate

The Government has borrowed €4bn from the bond markets at the lowest price in the history of the State.

The level of market interest could have seen the Government borrow as much as €5.75bn.

The yield – effectively the cost of borrowing – on the bonds is 0.867 pc.

08 Jan 2015

Bailout hits €1.3bn as KBC pumps €130m into Irish arm

KBC Group, Belgium’s biggest bank by market value, pumped €130m into its Irish unit last month, bringing the bailout bill to about €1.38bn as the lender continues to grapple with losses following the property crash.

KBC Bank Ireland raised the money by selling shares to its immediate parent, KBC Bank NV, in Brussels on December 22, according to documents filed with the Companies Registration Office. The Dublin-based unit received €1.25bn of capital support from its parent between 2008 and 2013, it said.

08 Jan 2015

Economic fears rise as Europe sinks into deflation

TUMBLING oil prices have helped drag the Eurozone into deflation for the first time in more than five years, heaping further pressure on the European Central Bank (ECB) to start printing money.

Inflation in the bloc turned negative last month, with consumer prices falling by 0.2pc year-on-year, sparking fears that the region could enter a prolonged period of deflation.

It has also raised expectations that data due to be released here will show inflation also dipping into negative territory on an annual basis.

07 Jan 2015

US investment giant Blackstone upbeat on Irish prospects

Senior executives from global US investment firm Blackstone joined the bosses of Irish firms including Smurfit Kappa, Kerry Group and Permanent TSB in New York yesterday as they showcased their businesses to over 80 North American financial institutions.

The Davy Annual Equity Conference also attracted key executives from a number of other Irish firms such as hotel operator Dalata, insulation maker Kingspan, Bank of Ireland, Fyffes and Greencore.

07 Jan 2015

Pace of job creation in services sector hits highest in 15 years

The rate of job creation in the services sector last month rose at its fastest pace in at least 15 years, a survey has found.

The sector here ended the year on a high, with December recording faster increases in both activity and new business, according to the latest Purchasing Managers’ Index (PMI).

And reports of improving economic conditions and an increase in work boosted optimism among companies about the prospects for this year.

07 Jan 2015

Government to borrow up to €4bn today on the markets

THE Government is to borrow between €3bn and €4bn on the bond markets today, the Irish Independent understands.

Plans for a bond sale were announced yesterday by the National Treasury Management Agency (NTMA), but the agency did not specify the size of the sale and said only that it would take place “in the near future”.

Bond yields are at historic lows so the sale will result in cheap funding for the Irish taxpayer over the next seven years, according to Cantor Fitzgerald Ireland’s head of fixed income strategy, Ryan McGrath.

19 Dec 2014

Mortgage arrears may be caused by Irish banks’ leniency – IMF

The exercise of extensive forbearance by Irish banks on home loan defaults is “likely” to have contributed to the accumulation of arrears in the aftermath of the crash, says an IMF working paper.

While the paper suggests the economic benefit of temporary forbearance and loan modifications for struggling households could outweigh their costs, it says this depends on the circumstances prevailing in the country.

“Extensive forbearance, such as interest-only payments, helped smooth consumption but allowed arrears to build,” the paper says of the situation in Ireland.

19 Dec 2014

Extra public service pay day to cost exchequer €300m

The inclusion of one additional pay and pensions day in public expenditure next year for “technical” reasons will cost the exchequer some €300 million, Government documents show.

Revised spending estimates from Minister for Public Expenditure Brendan Howlin also show that Government moves to suspend metered water charges in favour of lower flat fees will necessitate a €85 million increase in public expenditure next year.

The 253-page document – known as “the Rev” in official circles – also sets out a further allocation of €62 million to meet additional spending pressures unrelated to the water scheme.

19 Dec 2014

Mortage approvals soar as buyers seek to beat restrictions

Mortgage approvals have jumped 42 per cent as first time buyers seek to get on the property ladder ahead of the introduction of new lending restrictions.

A total of 23,796 mortgage approvals have been recorded for the year to the end of November, according to figures compiled by the Banking and Payments Federation Ireland (BPFI).

It said the value of mortgage approvals for the first 11 months of 2014 was €4.2 billion.