Today in the pressFriday 04 January 2013 10.56
CENTRAL BANK FINDS MAJOR PROBLEMS WITH STOCKBROKERS - A worrying Central Bank report has found major problems in the country's stockbroking industry. The confidential report by the Central Bank warns there will have to be mergers of firms to ensure the industry survives, as part of a major revamp. The report also says this process will have to be done in a controlled way -- because any instability in the sector could pose a danger to many people's savings, and prevent new businesses from raising money at a time when banks are not lending. The report follows an unprecedented investigation by the financial watchdog into the industry, which lasted more than a year and uncovered numerous problems in the sector. A senior source told the Irish Independent that the sector is under pressure and the Central Bank believes further mergers will be necessary. The Central Bank is anxious to ensure that the consolidation occurs in a "sensible manner" and that firms are not incentivised to take undue risks to maintain unrealistic business levels. "The regulator is looking very closely at the position of the remaining firms, with very close monitoring and engagement. The Central Bank is also looking at the adequacy of client asset controls to make sure that client funds are properly protected," the source said. The Irish Independent also understands that the regulator will be taking a tough position on any problems with how assets are controlled, and will be concluding a review on client assets early this year. The country's oldest stockbrokers, Bloxham, went bust last year.
RIM SELLS DUBLIN FIRM NEWBAY AT STEEP DISCOUNT - BlackBerry parent Research in Motion (RIM) has offloaded its Irish mobile development unit NewBay at a steep discount to US mobile content firm Synchronoss. The Canadian company bought the Dublin-based cloud services firm for a reported $100 million in October 2011, writes the Irish Times. At the time, the acquisition was seen by observers as a way for RIM to compete with file hosting and sync services, such as Apple iCloud, Amazon Cloud Drive and Google Docs (now Google Drive). However, New Jersey-based Synchronoss confirmed this week that it had acquired NewBay from RIM for $55.5 million in cash, saying the transaction had been completed at the end of the fourth quarter of 2012. Synchronoss, which employs 30 people at a research and development centre in Galway, has been on an aggressive buying spree. The Nasdaq-listed company recently acquired mobile social networking company Miyowa and mobile contact and content management provider FusionOne. Chief executive Stephen Waldis said that adding NewBay’s technology assets and its millions of subscribers would bolster the company’s international presence. RIM has so far declined to comment on the NewBay sale or on speculation the sale may have been prompted by a deterioration in its financial position.
FEARGAL QUINN TOPS POLL FOR BUSINESS ACUMEN - Irish SMEs have voted Feargal Quinn as the most admired entrepreneur, according to a survey which also found the sector was struggling with a lack of demand and direction. The survey by Viking Direct found that depressed customer demand is the primary reason for small businesses failing in Ireland, ahead of a lack of finance. That is according to a survey of over 1,000 small and medium-sized businesses in the UK and Ireland, reports today's Irish Examiner. Viking Ireland director Michael Walby said the findings should serve as a warning to entrepreneurs about how tough the business world can be. When Irish businesses were asked what entrepreneur they looked up to for their business acumen, a third cited Feargal Quinn, followed by Pádraic Ó Céidigh, Bobby Kerr and Norah Casey. In the UK, it was the Virgin founder Richard Branson.
CRISIS OF FAITH OVER VATICAN CASH MACHINES - A stand-off between two titans of finance, the Bank of Italy and the Vatican, has forced tourists to abandon their visits to the Sistine Chapel - unless they have cash in their pockets. The Financial Times says that Italy’s central bank has blocked all electronic payments through cash machines and by credit cards in Vatican City following the world’s smallest state’s failure to fully comply with international anti-money laundering rules. The incident raises further questions about the transparency of the Vatican’s finances. Its efforts to adopt international standards in combating money laundering and terrorist financing were given a mixed assessment last July in a study of its financial system. Deutsche Bank’s Italian division, which runs a network of cash machines for the Vatican, was refused authorisation from the central bank to continue operating its services within the walled state from the start of the year. The Vatican is not included in the European Commission’s “white list” of states that fully comply with international standards against tax fraud and money laundering. In a tightly worded statement, Father Federico Lombardi, head of press relations at the Holy See, said the use of the cash machines inside Vatican City was “at the point of expiry”.