Today in the press

Thursday 17 January 2013 11.01
A look at some of today's business stories in the newspapers
A look at some of today's business stories in the newspapers

5,000 RETAIL STAFF TO DEMAND €400 PAY RISES - More than 5,000 Brown Thomas and Dunnes Stores staff will today seek pay rises worth €400 a year on the back of increases for other shop workers, reports the Irish Independent. A union representing 1,500 sales assistants at the upmarket Brown Thomas chain will demand a 2% wage increase at the Labour Relations Commission this morning. Mandate will also seek a 3% pay rise for Dunnes' 4,000 workers at the Labour Court, after the supermarket giant refused to attend talks. The pay rises are worth in the region of €400 a year for full-time staff, although the industry's numerous part-time staff would get less. Talks took place earlier this week in relation to a 3% pay rise for 3,500 Penneys workers, while 700 Boots employees are seeking a similar increase. The latest pay claims come after more than 3,000 Marks & Spencer and 13,000 Tesco workers got wage hikes worth up to €700 a year last year. Debenhams recently agreed to a 2% pay increase from September 1 after its 1,400 staff accepted plans to extend a pay freeze, which has been in place for two years.

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CENTRAL BANK GOVERNOR ISSUES WARNING TO BANKS OVER DISTRESSED MORTGAGES - The banks will be required to raise more capital if they do not begin dealing with distressed mortgages, the governor of the Central Bank has said. Addressing an Oireachtas committee yesterday, Professor Patrick Honohan said there were approximately 100,000 cases of loans in distress and the Central Bank had been putting pressure on the banks to put in place “a machine” to process them. He said that once the machine was in place, the Central Bank “can and will” then require the banks to deal with prescribed numbers of cases, writes the Irish Times. If the banks failed to do this, the Central Bank would require them to raise more capital, as not dealing with the loans would affect the risk position of the banks. Professor Honohan made his remarks to the Joint Committee on Finance, Public Expenditure and Reform, where a number of TDs complained that the Central Bank was not doing enough to force the banks to deal with people who had loans they could not service. Professor Honohan told committee chairman Ciarán Lynch (Labour) that the issue was a key one for the Central Bank. His comments came as the ratings agency Standard Poor reiterated its negative view on Ireland and said the banks may need more capital.

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GERMANY CREATES PILES OF GOLDEN OPPORTUNITIES - Criminal masterminds and Hollywood scriptwriters have been put on notice. Germany’s central bank is planning to shift 54,000 gold bars worth €27 billion from Paris and New York to its base in Frankfurt, one of the biggest publicly announced shipments of the precious metal on record, says the Financial Times. Not to make it too easy for anyone planning a series of heists, the Bundesbank declined to say exactly how it would transport the gold, or exactly when. But between now and 2020, all 374 tonnes of gold bars, each one weighing 12.5kg, stored at the Banque de France will have been moved - probably by truck - to their new home in the vaults below the Bundesbank’s grey 1960s office block in an unfashionable corner of Frankfurt. Simultaneously, an operation will start to repatriate 300 tonnes of Germany’s 1,500 tonnes of gold on deposit at New York Federal Reserve, this time probably by aeroplane in small batches of 3-5 tonnes in order to be able to insure it, gold traders said. It is the first time the Bundesbank has decided to tell the world that it is about to move lots of gold around ahead of time. In doing so, it is following in the footsteps of some odd bedfellows, including Venezuela, Iran and Libya, who were typically trying to get ahead of possible asset seizures as a result of international sanctions.

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JP MORGAN CHIEF COUNTS THE COST OF 'LONDON WHALE' AS BONUS IS CUT BY HALF - The “London Whale” loss has swallowed half of Jamie Dimon's pay, with the JP Morgan Chase chief executive losing his crown as Wall Street's highest-paid bank boss as a result of the $6.2bn (£3.8bn) trading blunder. The London Independent says that the bank's profits during the final quarter of 2012 rose by more than 50%t, but Mr Dimon's pay package plummeted after the company's directors concluded that he bore "ultimate responsibility for the failures" connected to the ill-fated bets placed by Bruno Iksil, the trader nicknamed the London Whale. Mr Dimon, who earned $23m for 2011, making him the top-earning bank chief on Wall Street, will be paid $11.5m for 2012. His base salary, at $1.5m, remains the same, but the loss means his bonus has gone from $21.5m for 2011 to $10.5m for last year. The board has also delayed valuable share options which were awarded to Mr Dimon in 2008 - which he could have cashed in later this month - until July 2014. The investigation found that the losses, which involved outsized credit derivatives positions that Mr Iksil took for the bank's chief investment office, the division responsible for investing and managing excess cash, seriously damaged JP Morgan's reputation and has led to a series of court cases against it. Earlier this week US regulators ordered the bank to tighten its controls.

Keywords: presswatch