Morning Business News - March 22

Friday 22 March 2013 08.05
Morning Business News - March 22
Morning Business News - March 22

Belgian bank KBC, which owns KBC Ireland, has sold its 16% stake in the Polish Bank Zachodni for €900 million.

That values Zachodni at just under €5.5 billion.

AIB was previously the majority shareholder in Zachodni. The Irish bank sold its 70% shareholding for €2.9 billion in 2010 as part of its drive to raise new capital.

That transaction valued Zachodni at €4.2 billion; a full €1.3 billion less than it's worth today.

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The tourism industry traditionally makes a big push at this time of year, looking particularly to capitalise on St Patrick's Day to attract attention to Ireland.

But the Irish funds industry has also been on a promotional push.

Pat Lardner, chief executive of the Irish Funds Industry Association, has returned from the US where he has been on a whistle-stop tour.

He said there were “great interest levels” amongst US investors, be it in relation to doing business in Ireland or the various regulatory developments in Europe.

Mr Lardner said the IFIA was looking to employ more people in the industry across Ireland.

He also said the association felt the EU’s proposed Financial Transaction Tax would ultimately be a tax on savers and there would be better ways of achieving the intended goal.

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European shares are heading for their worst weekly performance since November.

All expectations are that further share price falls are in store when markets open at 8am as uncertainty over the outcome of Cyprus bailout talks weighs on investor sentiment.

Gold is, incidentally, at its highest level in a month - always a pretty good indicator of the level of anxiety out there when people are seeking safe havens.

The euro remains just above a four month low against the dollar of $1.29. Against sterling the single currency is trading at just under 85 pence. This time last month it was at 88 pence.

That, ironically, is one of the potential silver linings to the Cyprus crisis, at least from an Irish point of view, in that it takes some pressure off exporters.

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Shares in the sportswear company Nike were up strongly overnight as it reported better-than-expected profit for the most recent financial quarter.

Nike recorded a $662m net profit for the three months to the end of February, up 16% on the same period last year.

That was higher than analysts had looked for so Nike shares up 8% overnight.

Nike, incidentally, is showing little sign of being affected by the so-called curse of Nike.

Recent scandals involving Lance Armstrong and Oscar Pistorious, both of whom had lucrative endorsement deals with the sports brand, have not dampened demand for its products.

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Fresh from its success in clinching agreement on measures to curb bankers pay the European Parliament's economic and monetary affairs committee is now targeting fund managers.

It has voted for bonus payments to fund managers of UCITs, which are EU regulated mutual funds, to be limited to a maximum of 100% of their annual fixed salary.

The committee is pushing these measures as an effort to limit the extent to which fund managers might be incentivised to make investments which may boost their own pay in the short term but expose investors to unnecessary risk of losses.