Today in the press

Wednesday 08 January 2014 14.49
A look at some of today's business stories in the newspapers
A look at some of today's business stories in the newspapers

EURO ZONE PERIPHERY'S BORROWING COSTS TUMBLE - Borrowing costs for the euro zone’s crisis-hit countries tumbled on Tuesday after a surge in investor demand for Irish government bonds allowed Dublin to easily raise almost half its funding target for this year, says the Financial Times. Yields on government debt, which move inversely with prices, fell sharply in Spain, Portugal and Greece as well as Ireland after investors placed €14 billion of orders in an offer of 10-year Irish bonds. The bond issue, which ended up raising €3.75 billion, was Ireland’s first since it exited its international bailout programme last month. The strength of demand for eurozone “periphery” debt reflected increased investor appetite for higher-yielding government bonds as well as rising confidence in the creditworthiness of eurozone economies. It improved significantly the chances of Portugal following Ireland’s example and exiting its bailout programme later this year - and of Greece also soon being able to tap international debt markets. While US and UK government borrowing costs have risen in recent weeks since the US Federal Reserve announced plans to “taper” its quantitative easing programme, yields on eurozone “periphery” bonds have headed in the opposite direction. “The ‘rising angels’ of the eurozone periphery are attracting lots of demand,” said Charlie Berman, chairman of Barclays debt capital markets operations. Ireland’s order book “was filled by a who’s who of northern European real money investors,” said Philip Brown, head of sovereign capital markets at Citigroup. 

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TAXPAYERS HAND OVER €38 BILLION TO STATE - Taxpayers handed over close to €38 billion to the State last year, the latest figures show. The Irish Times says that headline numbers published by the Revenue Commissioners show they collected €37.8 billion in taxes from workers, businesses and consumers in 2013. Of this, workers paid €15.76 billion from their wages, making income tax the biggest single component. VAT came in second at €10.34 billion. Businesses paid €4.3 billion in corporation tax on profits, along with €369 million on capital gains and €279 million on capital acquisitions. Excise, charged on alcohol and tobacco, accounted for €4.9 billion, making it the third-highest tax earner for the State in 2013. Revenue chairwoman Josephine Feehily reiterated that more than nine out of 10 of those eligible paid the controversial local property tax last year. Yesterday’s figures show the Revenue received 1.6 million individual returns, a compliance rate of 91%, which yielded a total of €242 million. Property owners also paid €76 million in respect of 2014.

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INSURANCE FIRMS IN DEEP WATER AS FLOOD DAMAGE PAYOUTS TAKE MASSIVE TOLL - The insurance industry is unprepared for the financial toll of this winter's stormy weather, analysts have told the Irish Independent. Claims caused by the latest period of bad weather, which has resulted in heavy flooding in coastal areas around the country, looks likely to run into the hundreds of millions for the country's biggest property insurers, who include RSA, Aviva and FBD. The last major flood to hit the country, in November 2009, cost the industry €244m, according to representative body Insurance Ireland. Sources said this month's floods, a result of what meteorologists are describing as "the worst storm in 15 years", could result in an even higher bill. "Given the scale of what's happening, the end figure may well be at the upper end of historical highs," said Emmet Gaffney, an insurance analyst with Investec. FBD, Ireland's only listed general insurer, has already been forced to issue a profit warning on the back of the storms at the tail end of 2013. It announced last week that storm damage in the last two weeks of December cost it between €4m and €5m, reducing operating earnings per share by between 10 and 13 cents. Its earlier financial forecasts had assumed that there would be no exceptional weather events during the remainder of the year.

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EASYJET NARROWS GAP WITH RYANAIR AS PASSENGER NUMBERS TAKE OFF - EasyJet flew more than 60 million passengers last year as more Britons spent Christmas overseas. In total, the orange airline flew 61.33 million passengers in 2013, which is 3.6% more than during the previous 12 months, writes the London Independent. It was partly boosted by its strong numbers in the lead up to Christmas - in December it carried 4.49 million passengers, 3.5% more than in the same month a year earlier. Top destinations included Amsterdam, Geneva, Barcelona and Berlin. EasyJet’s growth in 2013 helped it to narrow the gap with Europe’s biggest budget carrier, Ryanair, which saw passenger numbers grow only 2.3% last year. Still, the Irish carrier packed a record five million customers onto its planes in December, and flew a total of 81.4 million people during 2013 - a year when it announced it would revamp its customer services and cut fees in response to passenger complaints.

Keywords: presswatch