Business and Leadership Ltd.

Moody’s has downgraded Ireland’s rating to junk status. Last night, the credit rating agency said it downgraded Ireland’s government debt one notch from Baa3 to Ba1. The outlook on the ratings remains negative, which means a further downgrade is still possible. The move came as a blow just hours after Ireland was optimistic that Europe had taken moves which would help it out of the financial crisis. Moody’s said it decided to downgrade the debt because of the growing possibility that a second round of financing by the EU and IMF will be needed at the end of 2013. The agency said it is possible that Ireland will not be…

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Business and Leadership Ltd.

Michael Noonan today published a finance bill to allow same sex couples have the same tax rights as married couples. The Minister for Finance needed to change existing tax legislation to bring it in line wit the Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010. Civil partners will now receive the same tax treatment as married couples in respect of income tax, stamp duty, capital acquisitions tax, capital gains tax and VAT. In addition, the bill allows for the taxation consequences of the redress scheme for opposite-sex and same-sex cohabiting couples provided for in the 2010 Act. Noonan gave credit to the previous government for its commitment…

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Business and Leadership Ltd.

A levy of 0.6pc imposed on pension funds to pay for some of the measures announced in yesterday’s Jobs Initiative has produced an uncalled for “quasi-hysterical” reaction, according to Minister for Finance Michael Noonan. The effect the levy will have on pension funds has been “exaggerated” by the pensions industry, Noonan told reporters at a press conference following the Dáil announcement of the much-anticipated Jobs Initiative. He said the Government were “pulling back a very small proportion” of major tax reliefs that the funds have enjoyed in previous years. It will take very little from the value of the funds, he said. He criticised the “quasi-hysterical” reaction, pointing out that…

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Business and Leadership Ltd.

The price of spot gold steadied today after hitting a record US$1,575.79 an ounce yesterday, while silver recovered from its biggest drop in 29 months. The death of al Qaeda’s leader Osama Bin Laden accelerated spot gold’s drop to $1,540.39 from a record high of $1,575.79 on Monday. Later Tuesday, spot gold was flat at $1,543.89 an ounce. Gold’s bull run has continued as investors look for a safe haven for their money amid worries about the weak US dollar, the ongoing eurozone debt crisis and global inflation. It lost some appeal following the death of Bin Laden but this concern will be short-lived, according to analysts. Silver rose by…

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Gov publishes the Nyberg report into banking crisis

The main reason for the Irish banking crisis was the “unhindered expansion” of the property bubble financed by the banks using wholesale market funding, the Nyberg Report has found. The report of the Commission of Investigation into the Banking Sector, Misjudging Risk: Causes of the Systemic Banking Crisis In Ireland, more commonly known as the Nyberg Report has been considered by the Cabinet and published by the Minister for Finance this afternoon. The investigation was commissioned by the government to establish exactly what happened to lead to the utter collapse of the Irish banking system in 2008. Every Irish financial institute has now been fully or partially nationalised. The report…

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Business and Leadership Ltd.

The authors of the Nyberg Report have said it is “unfortunate” that a challenging dialogue was not used by auditors to influence the business models and lending practices of financial institutions. Investigating the causes of Irish banking crisis, the Commission said that a sufficient, timely and challenging auditor dialogue could have been used to influence the banks’ business models and lending practices. There is no express requirement for an auditor to do so and the report found that their commentary regularly focuses on issues relating to the accuracy of historic accounts. “In practice, this means that auditors look primarily backwards and at technical issues that may influence the accuracy of…

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Business and Leadership Ltd.

Finance minister Michael Noonan said today that the government has succeeded in restoring confidence to Ireland’s banking system. He noted that Bank of Ireland shares had advanced for three days in-a-row and are currently up about 45pc on last week’s trading price. AIB has seen significant increases in its shares, as well, said Noonan. The minister of finance also said that the amount of deposits being withdrawn from the two “pillar banks” has been reduced substantially since Thursday’s announcements. Noonan told the Dáil that Irish 10-year-bond rates peaked to 10.32pc on March 31 but have since fallen back to below 10pc. He noted the positive response from various credit rating agencies and…

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Business and Leadership Ltd.

Governor of the Central Bank Patrick Honohan has once again said he “looks forward” to welcoming foreign owners for Irish banks. Explaining his remarks, he said it is evident that the involvement of new foreign owners could put the banking system on a “firm footing”. He said they can bring capital, risk control and other management skills. Speaking at the Institute of International and European Affairs, Honohan said that the Irish banks need to be downsized, therefore reducing risks and helping the Irish economy demonstrate the tail risk is lower than investors currently believe. “An effective bank restructuring requires that the fortunes of the banks and the budget be convincingly…

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Business and Leadership Ltd.

Met Éireann said that record low temperatures were seen in parts of the country last night, with some areas seeing temperatures as low as -16degrees. Sub-zero temperatures are expected to last for a few more days with a thaw not expected until Christmas Eve. Forecaster Evelyn Cusack said that there will be no thaw until Christmas Day, when rain and southerly winds are more likely. The weather continues to cause chaos for travellers. The AA has issued road warnings across the country. Dublin Bus and Bus Eireann have confirmed that most services are running as normal but there are some curtailments. Travellers are advised to check their websites – www.dublinbus.ie and…

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Goods and services exports continue to drive growth

Ireland’s quarterly national accounts show that both GDP and GNP rose compared with the previous quarter. Seasonally-adjusted GDP and GNP grew 0.5pc and 1.1pc respectively. This is the first seasonally-adjusted increase in both since 2007, according to the Central Statistics Office. At an annual rate, GDP increased by 2pc, while GNP was up by 4.5pc. However, compared with the 2009 third quarter, GDP decreased by 0.5pc, while GNP fell by 1.6pc. Commenting, Minister for Finance Brian Lenihan said this year-on-year growth will turn positive during the final quarter or early in the new year. He attributed the growth in the economy to the “very strong” performance of the export sector.…

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