The Irish Independent reports that Anglo Irish Bank continued the transfer of its second tranche of €8bn in loans to the National Asset Management Agency (NAMA) at the weekend -- and the Irish Independent understands the full amount could be with the agency by next weekend.

Four of the five participating institutions in NAMA -- Bank of Ireland, Allied Irish Banks, Irish Nationwide and EBS -- transferred €5.2bn worth of loans at an average discount of 48pc to NAMA last month. Anglo had also been due to transfer loans at that time. It is believed the delay in transferring the Anglo loans was due to the amount of due diligence being undertaken on them and the scale of the loan book. Last month it emerged that just one-quarter of the €15.3bn first tranche of loans transferred to NAMA was being repaid, despite the banks' assurances that 40pc were performing.

That meant that 75pc -- or €11.5bn worth -- of loans transferred to the toxic assets agency by financial institutions were no longer being actively repaid.

The extremely poor quality of the loans is understood to have been a disturbing surprise for NAMA bosses.

The weekend before last, about €1.4bn worth of Anglo's second tranche of loans were transferred to NAMA. It is believed the complete second tranche of loans will be transferred to the toxic bank by either next weekend or the weekend after at the latest.

Irish Nationwide took a 72pc haircut on the value of loans it transferred to NAMA in the second tranche, while AIB took a 48.5pc cut, Bank of Ireland 37.8pc and EBS 46pc.

Meanwhile, the National Treasury Management Agency is preparing tomorrow to auction up to €1.5bn in a 4pc bond that matures in 2014 and a 5pc bond that matures in 2020. Ireland's borrowing costs have been rising, and Central Bank Governor Patrick Honohan has described the spread between Irish and German 10-year bonds as "ridiculous".

The ECB has reportedly been buying into short-term Irish bonds in an effort to eliminate market volatility.

The Irish Independent also reports that Aer Lingus chief executive Christoph Mueller has warned Transport Minister Noel Dempsey that increasing passenger charges at Dublin Airport would force the airline to find an additional €25m in annual savings.

Mr Mueller said the airline would have to absorb an up to 41pc rise in passenger charges from this year because it would not be possible in the "current and expected demand environment" to pass the increases on to consumers. That would force the airline to up its annual savings target from €97m to €122m.

The Aer Lingus chief made the comments in a letter to Mr Dempsey last November after the minister effectively ordered Aviation Regulator Cathal Guiomard to push through substantial rises in passenger charges at Dublin Airport to ensure that the Dublin Airport Authority (DAA) remained a financially secure operation.

The letter was released to the Irish Independent under theFreedom of Information Act.

In it, Mr Mueller said a 41pc rise in passenger charges at Dublin Airport would raise Aer Lingus's annual charges at the facility from about €62m to €87m.

"In the context of our cost reduction plan, the effect of your direction will be for the savings from staff taking paycuts or even being made redundant, having to be handed over to the DAA just to cover increased airport charges.

"This cannot have been your intention, however, it will be one of the consequences," Mr Mueller told Mr Dempsey.

"At a time when traffic is falling and the industry is seeing a structural change in what consumers are prepared to pay, we find it bizarre that you should, in effect, direct the DAA to increase charges further," added Mr Mueller.

The DAA subsequently said the charge increase wasn't big enough.

The Aer Lingus chief executive has been trying to finalise staff layoffs, wage cuts and changed work practices as part of the €97m 'Project Greenfield' plan.

Rosters

Although all staff had eventually signed up for the cuts, cabin crew last week voted for industrial action in light of changes being made to their rosters.

After the minister's direction last year, the Commission for Aviation Regulation announced just before Christmas the new tranche of passenger charges that would apply at Dublin up to 2014.

"I must take account of the long-term development of the Irish aviation market and the significant role that adequate terminal and runway facilities at Dublin Airport will play in ensuring connectivity to key business and tourism markets," wrote Mr Dempsey. However, Ryanair chief executive Michael O'Leary accused Mr Dempsey in a letter of being more concerned about appeasing the DAA's bankers than reversing a sharp fall in airline passenger traffic.

The Irish Times reports that Europe's economic recovery is still “gradual” despite strong growth in Germany, said Irish Central Bank governor Prof. Patrick Honohan yesterday.

German GDP rose 2.2 per cent quarter on quarter, its fastest quarterly rate since the country reunified in the early 1990s following the fall of the Berlin Wall, pushing the euro zone aggregate GDP growth to 1.0 per cent.

The growth spurt helped push the 16-member bloc to its fastest expansion rate in three years.

“The story is a rather slow recovery despite the rather encouraging news from Germany,” said teh governor, who is a member of the European Central Bank rate-setting governing council.

That gradual growth and still-tame inflation, as well as the lack of asset bubbles emerging, means there is no need to rush for early exit strategies from market support measures by the ECB, he said.

One of the measures the ECB has undertaken since the intensification of the global financial crisis is to lend banks as much money as they request. Although it did experiment with competitive tenders in April, it has since reversed tack.

“If we look at the last few weeks . . . we see some widening of [sovereign] spreads rather than a narrowing, so from that perspective it would not be pointing in direction of further exit steps of that type,” Prof Honohan said.

He noted that the earlier move to competitive tenders had “highlighted pockets of sensitivity in the money markets that perhaps were unexpected”.

The ECB held interest rates at a record low 1 per cent at its last meeting on August 5th and said that inflation pressures over the medium term “remain contained”.

Prof Honohan declined to comment directly on economists’ forecasts that see the ECB holding rates until well into 2011, but said he saw few signs of “excesses” emerging in asset prices. “I don’t see that at the moment, but that I think is something that will be in the back of everybody’s mind in the months ahead,” he said.

He said Ireland remained committed to its target of reducing its budget deficit to 3 per cent of gross domestic product by 2014.

Risk premiums on Irish bonds surged on Wednesday, hitting 300 basis points over German bonds for the first time since early July amid talk of European Central Bank action to stabilise the spread and after Anglo Irish Bank won EU clearance for another, bigger than expected bailout.

The EU last week approved plans for up to €10 billion of state aid for Anglo Irish and Prof Honohan said that plans to recapitalise the bank were well on track and had little impact on the Government’s overall deficit plans.

“If you said €22-€25 billion nobody could disagree with that for being a realistic figure for the Anglo Irish net cost to the exchequer,” he said. “In terms of overall net borrowing for the Government, this is not a game changer.”

The Irish Times also reports that CAO points for most college courses are set to increase this year because of a surge in demand for third-level college places.

A tighter jobs market has driven up competition for places, with final CAO figures showing a 4 per cent increase in applications for level 8 or higher degree courses.

There has also been a sharp increase in demand for places in medicine and related areas.

With Leaving Certificate students set to get their results on Wednesday, career experts predict a significant increase in points for all medical related courses.

Details of this year’s CAO points requirements will be published next Monday. They are expected to show a slight increase in points for arts; a marginal increase for most science and engineering courses; no major change from last year for business courses; a dramatic fall off for property and construction courses; points will increase again for nursing; and no major change is expected in the requirement for teaching.

Overall, college applications for higher level courses have reached record levels, and are up from 64,774 to 67,640. This reflects a huge surge in interest among mature learners because of the economic downturn. The closing off of apprenticeship schemes and the embargo on public service recruitment is also driving demand for college places.

In medicine, applications are up by over 10 per cent while demand for dentistry is up 14 per cent.

Overall demand for courses listed by the CAO as “other healthcare” – such as occupational therapy, speech and language therapy, rehabilitation and athletic therapy and social care – has risen by over 25 per cent.

Physiotherapy, where student interest fell back last year, has bounced back with a 21 per cent increase in applications.

The new figures also show a 5.5 per cent increase in applications for arts and social science courses.

After years of falling back, points for arts increased last year. A further modest increase in points is expected this year for most arts courses – including arts at University College Dublin, the largest undergraduate course in the State.

Students can also expect a similar trend for business courses where applications are also up by 5 per cent. Business courses boomed during the Celtic Tiger years but student demand has slowed in the past three years.

In nursing, points increased last year after the Health Service Executive moved to cut the number of training places. Points are expected to rise again this year after a 4 per cent increase in applications.

This year’s CAO figures are also expected to show an increase in points for science courses with some 540 additional students seeking places on science and related courses. After years of decline, points for science have increased dramatically as parents and students see it as an area with strong employment potential. Last year, points for science in UCD rose from 305 to 385.

As expected, student demand for courses linked to the construction industry has fallen away significantly. Overall, applications for courses grouped by the CAO as the “built environment” are down by close to 23 per cent. Only 317 students chose courses in this area as their first college preference.

Demand for courses in architecture also slow with only 750 applications. Negative publicity about unemployed solicitors is also feeding into CAO choices. Demand for law courses is down by over 4 per cent.

Publicity about decreased margins and mark-ups for pharmacies has had an impact as demand for pharmacy courses is down 21 per cent.

Surprisingly, demand for courses in teaching and education has increased only marginally, despite the Government’s commitment to recruit extra teachers and maintain class size at current levels. Points are expected to be broadly similar to last year’s levels for teaching.

A similar pattern is expected for courses in agriculture and art and design where demand for places has increased marginally.

The Irish Examiner reports that emergency welfare payments have ballooned to a cost of €100 million for the first six months of this year, as more people than ever look for extra help to survive.

Almost 42,000 people are now in receipt of emergency payments under the basic supplementary welfare allowance scheme, the so-called "safety net" of the social welfare system.

The cost of the payments in the whole of 2007 was €150m, with just 27,379 recipients. This increased to 35,546 people at the end of 2008, costing €184m for the year.

With costs for the first six months of the year hitting €100m and the number of recipients exceeding the total number in 2008, fears are mounting the total cost for this year will break records.

The supplementary welfare allowance scheme was designed to provide a small weekly allowance to people with little or no income. It is administered on behalf of the department by the Health Service Executive’s community welfare officers and each payment is at the discretion of the individual officer.

The latest figures show that almost 20,000 of those currently in receipt of the payment are awaiting jobseekers’ benefit.

In excess of 4,000 are awaiting a disability benefit and almost 4,000 lone parents are in receipt of the emergency payment.

The news comes as the ESB confirmed it is cutting off an average of 900 people a month from electricity supply after a prolonged period of failure to pay bills.

In further evidence of ordinary people’s increasingly dire financial circumstances, the latest figures from the Money Advice and Bugeting Service (MABS) reveal its new client figures are up 10% from the same time last year.

The MABS figures show it assisted almost 13,000 new clients in the first two quarters of the year.

Michael Culloty of MABS said there was no let-up in the number of desperate people seeking assistance. He said most people were in difficulty not because of any reckless spending or borrowing, but purely because of a change in circumstances.

More than 11,000 of MABS’ new clients this year are high-support clients: those who have been assisted to negotiate repayment plans with their creditors, and special account clients whose repayment plans are supported through a MABS special account scheme, a bill-paying facility operated in partnership with credit unions.

In excess of 6,000 of the high-support clients are aged between 26 and 40, with more than 2,500 of those married with children. Almost 2,000 are single with children.

The statistics show that almost 4,500 have a mortgage.

Mr Culloty said this had started off from a very small base, and now mortgage-holders made up about one third of clients.

"These are people, mainly families, who had jobs and who have now lost one or both of them and are finding it extremely difficult."

The figures also show that almost 70% of MABS clients are primarily living off social welfare.

Personal loans with financial institutions made up the highest category with 6,219 people owing money to them. The next highest category under which debt was an issue was utilities at 4,133, followed by credit cards at 3,537.

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