Today in the press

Friday 24 January 2014 08.37
Today in the press
Today in the press

GERMANY SUPPORTED BURNING OF IRISH BONDHOLDERS - The Irish Times reports that, according to Bundesbank president Jens Weidmann, Germany’s central bank threw its weight behind Ireland’s failed 2010 effort to burn bank bondholders at the outset of the crisis.

Unlike then ECB president Jean-Claude Trichet, Dr Weidmann said the Bundesbank considered it “important to make investors bear the risks of their investment decisions” and “favoured contributions of investors” towards the cost of rescuing Ireland.

Mr Trichet, concerned that such a move might destabilise the wider euro area, blocked Ireland’s ambitions by securing a majority of the ECB governing council behind him.
 
The revelation challenges one popular Irish crisis narrative: that the priority of German officials in 2010 was, in concert with the ECB, to claw back full investment of German capital in Ireland by making Irish taxpayers foot the entire bill of the banking collapse.

Minister for Finance Michael Noonan, whose own attempt to impose losses on bondholders also fell foul of Mr Trichet, said he did not know the Bundesbank’s position towards his predecessor, the late Brian Lenihan.

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CARNEY SIGNALS END TO FORWARD GUIDANC - Mark Carney, Bank of England governor, has signalled that his policy of linking interest rates to the unemployment rate will be buried less than six months after its birth, according to The Financial Times.

He said the British economy was “in a different place” from last summer.

Mr Carney flagged the U-turn at the World Economic Forum in Davos, letting the news emerge in a series of television interviews where he said that unemployment alone would no longer guide policy.

Although his big idea for monetary policy bit the dust, Mr Carney said the BoE had no plans to raise interest rates “immediately”. He will outline his views fully in a speech on Friday.

Speaking to the BBC’s Newsnight programme in response to the news this week that unemployment had fallen to 7.1%, almost to the point where the BoE said it would consider a rate rise, Mr Carney indicated that the bank has decided not to revise its 7 per cent unemployment threshold.

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FACEBOOK COO PRAISES IRELAND - Facebook chief Sheryl Sandberg lavished praise on Ireland and the Taoiseach in a significant vote of confidence for the country's economic recovery, says The Irish Independent.

Hours after it was confirmed that the Facebook chief operating officer had become one of the world's youngest billionaires, she enjoyed a face to face meeting with Enda Kenny in the Swiss ski resort of Davos.

As part of the World Economic Forum, Mr Kenny took the opportunity to reassure Facebook that Ireland's corporate tax rate would not change.

And Ms Sandberg later responded with a positive message of her own – describing Mr Kenny as a "brilliant leader of a brilliant country".

Mr Kenny also told Ms Sandberg that he would open Facebook's new headquarters in Dublin's docklands in the autumn.

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KENTZ HAS €11.4BN OF WORK IN PIPELINE - Kentz — the Irish-founded engineering services group — closed 2013 with a pipeline of outstanding work projects, worth $15.6bn (€11.4bn); up 18% on the previous year, reports The Irish Examiner.

In its pre-close trading statement — ahead of the publication of its annual results in late March — Kentz said yesterday its standalone backlog of work was valued at $3.1bn, at year’s end. 

When the addition of US-based exploration facility solutions provider, Valerus FS — which Kentz bought at the turn of this year — is included, the group’s overall backlog amounts to $3.5bn. 

The recently announced acquisition of Valerus will increase Kentz’s exposure to higher value/margin contracts, improve its footprint in the US and give it an increased presence in Latin and South America.