Independent reports that Ireland does not expect to benefit from the deal to
reduce Greek debt but remains determined to find a mechanism to avoid paying
€3bn due in four months for bailing out Anglo Irish Bank, Taoiseach Enda Kenny
"It is the intention of the Minister for Finance, on behalf of the Government,
not to have to pay the €3bn that is due in March 2013," Mr Kenny told the Dail.
The Government is looking for concessions in a "different area" to Greece, he
His comments came after European finance ministers agreed to cut the rates on
Greece's bailout loans and suspend interest payments for a decade to give Greece
more time to repay the money it owes.
The deal paves the way for the release of urgently needed aid loans.
The deal, clinched at the third attempt after weeks of wrangling, removes the
biggest risk of a sovereign default in the eurozone for now, ensuring the
near-bankrupt country will stay afloat at least until after a 2013 German
Earlier, Portuguese Finance Minister Vitor Gaspar said in Lisbon that Ireland
and Portugal both stand to benefit from the deal.
"Portugal and Ireland, which are programme countries, will benefit through the
conditions opened in the framework of the European Financial Stability
Mechanism," Mr Gaspar said.
The suggestion was rejected by the Department of Finance.
"Last night was about Greece, not Ireland and there was no discussion on
extending the conditions or concessions agreed for Greece to Ireland," a
Private sector economists in Dublin welcomed the Greek deal with one calculating
that it could shave billons off the national debt if the same terms were
extended to Ireland.
"There are some important precedents set for Ireland and Portugal if their
programmes look like falling short in the coming years," said Goodbody
Stockbrokers economist Dermot O'Leary while Davy stockbrokers economist Conall
MacCoille said the deal "must surely strengthen Ireland's hand in negotiations
with the EU".
Owen Callan, an analyst at Danske Bank in Dublin, calculated that an Irish deal
similar to the Greek one would shave €12.5b off total Irish deficits over the
next decade. That would be equivalent to 8pc of gross domestic product.
Separately, the Organisation for Economic Co-operation and Development said a
deal to reduce Ireland national debt would "ease the burden".
The comments came in the Paris-based think-tank's semi-annual report on the
Irish and global economies.
The OECD forecasts the local economy will expand 1.3pc next year and 2.2pc the
following year after growing 0.5pc this year.
Unemployment will remain at the current high levels.
"While marked progress has been made in resolving the financial and banking
crises, economic growth is projected to remain low, but positive, during the
next two years," the OECD said in a chapter on Ireland.
The Government should be allowed some wiggle room if economic growth was slower,
The OECD sees the eurozone economy contracting next year and again in 2014 and
warned that the debt crisis in the single currency zone was the greatest threat
to the world economy. It slashed its global growth forecasts, warning that the
debt crisis in the recession-hit eurozone was the greatest threat to the world
It also urged central banks to prepare for more exceptional monetary easing if
politicians failed to come up with credible answers to the debt crisis.
Independent also reports that solicitor and property investor Brian O'Donnell is
expected to take to the witness stand today in a London courtroom where his bid
to declare bankruptcy in Britain has been challenged by Bank of Ireland.
Lawyers for both sides yesterday engaged in legal argument in the High Court
battle which surrounds where Mr O'Donnell and his wife Mary Pat's centre of main
interest (COMI) is.
The O'Donnells contend that it is in the UK but the bank says it is in Dublin,
leading to the accusation that the couple are 'bankruptcy tourists' seeking to
avail of the UK's more lenient bankruptcy laws.
Gabriel Moss, counsel for the bank, said he expected to cross-examine Mr
O'Donnell in the witness box for up to four or five days.
He said the solicitor, who was once one of Ireland's leading commercial lawyers,
was very experienced and not capable of a yes or no answer.
Paul Burton, representing Mr O'Donnell, said he was "amazed" that the
cross-examination would take this long and that the bank had "over-complicated"
There was further legal argument over another witness statement provided by Mr
O'Donnell and the attendance of Ms O'Donnell to give evidence at the case.
The judge adjourned the case until today when Mr O'Donnell is due to start
giving evidence this afternoon.
Under Irish law, bankruptcy can take up to 12 years to be completed while in the
UK it can take as little as 12 months.
This has led to a number of high-profile Irish businesspeople, who have suffered
as a result of recession, to declare bankruptcy in Britain.
The O'Donnells once commanded a property empire which included some €1bn worth
of assets in London, Washington and Stockholm amongst others through their
company Vico Capital.
Mr O'Donnell has listed a property on Barton Street in Westminster – a short
walk from the houses of parliament – as his home and has included a range of
receipts, tickets, dry-cleaning bills and a TV licence renewal as part of a file
to prove the city as his centre of main interest.
Bank of Ireland has secured a judgment from the High Court in Dublin against
them for €71.5m.
Last month, the couple and their two adult sons lost a bid to stop the High
Court dealing with the bank's case alleging fraud against them.
The bank brought an action against them alleging they conspired to put in place
a "blatant" scheme to put property assets in London beyond its reach. The couple
deny the claims.
The Irish Times reports that
the Government is poised to announce within the next few days that it is
splitting Shannon airport from the Dublin Airport Authority (DAA).
Ministers Leo Varadkar and Richard Bruton have
been working since May on a plan to combine the airport with State body Shannon
Development’s industrial land bank and separate it from the Dublin authority.
In the Dáil yesterday Mr Varadkar, the Minister
for Transport, said that the Cabinet had discussed a memo on the proposals, and
that he would be making an announcement in the very near future.
A spokesman for his department confirmed that
this was likely to be in the next few days.The split has been widely
It emerged recently that the Government was due
to decide on the plan by the end of this month, and that Shannon airport would
be split from the DAA, which has been responsible for the airport since 2004, by
the end of the year.
Mr Varadkar told the Dáil that once it was
separated Shannon would be able to set its own charges, which he said should
assist in getting new business.
The DAA’s overseas duty-free arm, Aer Rianta
International, which made €35 million profits last year, will remain with the
authority, the Minister said.
He pointed out that the duty-free company’s plans
mean it would have to spend €60 million in the next couple of years.
“It can only do that, it can only do its business
when it has the big balance sheet of the DAA to borrow against,” he said.
Shannon Airport will have its debt to the DAA
Mr Varadkar pointed that if the airport authority
was also to lose Aer Rianta International then that could threaten its
The Irish Times also reports
that an Irish online betting company backed by high-profile Wall Street hedge
fund owners is facing court action and possible fines in the US for breaches of
commodity trading regulations.
Dublin-based Intrade, which allows customers to
wager on commodity prices, stock market indices and world events, has closed its
website to US clients citing “legal and regulatory” pressures.
US regulator the Commodity Futures Trading
Commission has filed a series of civil complaints against Intrade and its
parent, Trading Exchange, in the federal courts, claiming that they unlawfully
allowed US customers to “buy and sell” options predicting that gold prices or
currency values would reach a certain level on a given date.
The complaint also alleges that the Irish
companies knowingly filed false forms with the commission claiming that Intrade
limited its activities to only to eligible market participants.
“Contrary to these representations, the complaint
alleges that Intrade unlawfully solicited and permitted retail US customers to
buy and sell off-exchange options on the website,”
A number of US hedge funds and their owners hold
shares in Trading Exchange Network, including Stanley Druckenmiller of Duquesne
Capital Management and Paul Tudor Jones of Tudor Investments.
When he worked with George Soros’s Quantum Fund
in 1992, Mr Druckenmiller masterminded the wholesale short-selling of sterling
that eventually forced the British government to take its currency out of the
European Exchange Rate Mechanism, the euro’s forerunner.
The fund was reported to have made more than $1
billion profit from its sterling trades in just a few days in early 1992. It
effectively broke the Bank of England, which did not have the reserves to prop
up the currency.
Mr Druckenmiller is reckoned to be worth $2.5
billion and has given an estimated $700 million to charities.
Mr Tudor Jones turned down a place at Harvard
Business School to set up his own hedge fund in 1980. He famously predicted the
1987 “black Monday” crash, tripling his fund’s investments through short
selling. Forbes Magazine has estimated his fortune at $3.4 billion.
The Irish Examiner reports
that Nama has spent €51.5m on legal fees since it was set up but expects to
recoup €36.16m of this from property developers.
In a response to a parliamentary question by Sinn
Féin’s Gerry Adams, Finance Minister Michael Noonan laid out the legal costs
incurred by Nama and the firms to whom they were paid. This year alone Nama has
incurred costs of nearly €8.5m up to Jun 30 that the bank expects to be able to
recoup from developers, a huge number of whom are bankrupt.
Mr Noonan said that where a developer is unable to repay the agency, their legal
costs the bill will be added to a developers’ loans.
"Borrower recoverable costs are principally legal fees which Nama has incurred
on behalf of Nama borrowers which are recoverable from those borrowers. Where
the borrower is in a position to repay such costs Nama will seek repayment in
cash. To the extent the borrower is not in a position to repay those costs, Nama
will add these costs to the borrower’s debt obligations to Nama."
Nama expects to recover €600,000 it has spent on due diligence so far this year
and a further €7.8m inlegal fees that the agency has taken on behalf of its
borrowers. Over the life of the agency it has spent a further €14.2m on due
diligence and €12.7m on legal fees.
The biggest legal earner in 2012 was A&L Goodbody which earned just shy of €1m
on behalf of Nama borrowers. William Fry made about €570,000 representing Nama
borrowers in court, while Eversheds O’Donnell Sweeney earned €515,000.
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