Today in the pressWednesday 19 February 2014 08.26
ULSTER BANK SET TO CLOSE MORE BRANCHES – The Irish Examiner reports that Ulster Bank will close more branches and move some head office functions to Britain following a company-wide review at parent company Royal Bank of Scotland.
However the bank will maintain a full banking presence in Ireland, according to a person familiar with the situation.
Ulster Bank’s parent company, RBS, is currently conducting a review of its operations, which is scheduled to be released on February 27.
There has been growing speculation over recent months that RBS would close down the bulk of Ulster Bank’s operations in this country.
According to a source who has direct knowledge of the review, Ulster Bank will keep open all existing services, including retail, corporate and private banking divisions.
It will look to grow its loan book in order to benefit from the recovering economy.
Ulster Bank has been active over recent months in refinancing loans that have been put up for sale as part of the IBRC liquidation, said an Ulster Bank source, although no details were provided.
But there will be a further round of cost cutting. This includes more branch closures, said the source. The bank closed 22 branches last year on both sides of the border.
NAMA TO SELL €2BN OF ASSETS THIS WEEK – The Irish Independent reports that NAMA is putting around €2bn of loans on the market this week, as the sell-off of its Irish portfolio continues.
The news comes amid speculation that the Government will press the agency to radically speed up its sale of Irish assets in order to radically shorten its original 10-year timescale to work out property loans.
It is understood the agency will put up for sale this week loans linked to Cork-based developer Michael O'Flynn. The loans have a face value of €1.8bn and the sale has been well flagged in advance.
The balance of this week's sale is €200m of loans linked to Dublin developer Brian O'Farrell, one of the so-called "Maple 10" group of investors who bought shares in Anglo Irish Bank from Sean Quinn in 2008.
During the boom, Mr O'Farrell's Headland Developments was focused on developments in north county Dublin.
The company's biggest planned project was to redevelop the Northside Shopping Centre as a €1bn 'Northside Town Centre' after buying the property for €100m from Treasury Holdings and AIB Investment Managers.
TAX CUT TO HELP JOB GROWTH ON THE CARDS - Minister for Finance Michael Noonan has reiterated the Government’s intention to cut income tax in this year’s budget, arguing that it would be an important tool for job creation, says The Irish Times.
“As soon as we have resources, our first priority will be to widen the average rate band of income tax,” Mr Noonan said yesterday at an OECD conference in Brussels.
Asked if Ireland was guilty of “complacency” for considering tax cuts soon after the bailout exit, he said the higher tax rate kicked in at the “very low level” of €32,800 in Ireland.
“That’s damaging job creation. As a labour market initiative – to make work worthwhile – we are saying that as soon as we have resources, our first priority will be to widen the average rate band of income tax.
“It’s not a promise to endear ourselves to the electorate, it’s another instrument of labour market policy,” he said, adding it would allow people to earn more, and take on extra work before hitting the higher rate.
While the Minister declined to be drawn on what the new threshold would be, he hinted that a growth rate of over 2% would strengthen the case for income tax cuts. “If various independent forecasters are correct, and the economy is growing faster than the 2 per cent [forecast], that should give taxation buoyancy,” he said.
Ireland had never been afraid to cut taxes, “even during the most difficult times”, he said. In particular, he highlighted the move to cut VAT on tourism, and the decision to cut the stamp duty on the transfer of farmland as ways of stimulating both sectors of the economy.
EU COULD BLOCK BRITISH BANK TRADE - The City of London will become little more than an “offshore financial centre” if Britain leaves the EU, a top Brussels official has said, warning its banks could lose access to the world’s third largest market, according to a report in The Financial Times.
Speaking at Cambridge university, Viviane Reding, the vice-president of the European Commission and an advocate of a federal United States of Europe, issued one of the starkest warnings yet, that the City should not expect unfettered access to the single market if the UK votes to leave the bloc.
In an intervention likely to anger those who argue Britain would be better off out of the EU, Ms Reding said: “The City would most definitely lose its unhindered access to the single market in the case of an exit.
“Because EU member states would obviously have no interest in supporting what would then be an offshore financial centre competing with their own financial firms.”
She also warned that other member states could work together to undermine London’s very large financial services sector, pointing out: “If the UK were to leave the EU, it would no longer be able to influence EU regulation.”