Today in the pressTuesday 11 March 2014 09.04
IBRC SEVERANCE TALKS STALL AS DEAL ALTERS - Efforts to negotiate a redundancy deal for some 100 remaining employees of Irish Bank Resolution Corporation (IBRC) have been derailed in recent weeks, according to finance union the Irish Bank Officials Association (IBOA). This has left staff “bitterly disappointed”, writes the Irish Times. Last October, chief executive of the Labour Relations Commission Kieran Mulvey was called upon to broker some kind of compensation agreement between all of the parties involved, including the special liquidator, Nama and the Department of Finance. However, according to IBOA general secretary Larry Broderick Mr Mulvey “encountered a serious obstacle in the last couple of days despite previous assurances that there was sufficient goodwill on all sides to suggest that his mediation initiative could be successful”. The negotiations focused on redundancy terms for employees. Before the special liquidation of IBRC in February 2013, employees were offered four weeks’ pay per year of service, including statutory redundancy. However, the workers are now being offered only the legal minimum entitlement of two weeks which is worth less than half of the agreed terms. The finance union estimates that the average salary of the remaining workers is less than €30,000 a year.
ULSTER BANK SUED OVER ALLEGED MIS-SELLING - Three brothers in the Cosgrave Property Group are seeking more than €250m damages from Ulster Bank over alleged mis-selling of financial derivative instruments or "swaps" under which some €370m is allegedly outstanding to the bank. Peter, Joseph and Michael Cosgrave, and one of their companies, allege breach of fiduciary duty and deceit arising from the selling of the instruments which, they contend, were unsuitable for them says the Irish Independent. The bank denies those claims and contends the swaps were "standard" financial instruments, known as "vanilla" swaps, with no particularly complex or unusual features. The bank says almost €370m is outstanding under the instruments, effective on dates from 2005, and allegedly secured on a large number of commercial and residential properties, mostly in Dublin. They include office blocks at Georges Quay, Dublin; West Pier Offices, Dun Laoghaire; 18 apartments at Camden Lock, Ringsend; a property on Shrewsbury Road, Dublin, and in Meridian Point, Greystones, Co Wicklow.
ACQUISITION OF DISTRESSED PROPERTIES IN DETROIT NETS HOBBS' FIRM €1.2m - The investment firm set up by consumer advocate Eddie Hobbs has recorded an immediate €1.2m gain from its investment in one of the least fashionable addresses in the US - Detroit, writes the Irish Examiner. The €1.2m gain from the purchase of distressed residential properties in the Detroit region contributed to pre-tax profits at Hobbs’ Brendan Investment Pan European Property rising 14-fold to €888,863 in the 12 months to the end of 2012. This followed a pre-tax profit of €60,562 in the 11 months to the end of December 31, 2011. According to the directors’ report attached to the Cork-based firm’s accounts, the distressed US properties were purchased in 2012 by the group’s US investment entity, Artesian Equities. The report states the directors “are satisfied with the investment strategy engaged in during 2012 and with the financial performance for the year and the balance-sheet positions at year end”.
BIG PHARMA WARNS AUSTRALIA ON POPPY SHORTAGE - Big pharma has warned Australia to expand its poppy growing industry beyond the remote island of Tasmania amid fears the world’s biggest supplier of narcotic raw ingredients for pain killers faces a supply crunch as global demand surges, reports the Financial Times. GlaxoSmithKline, Johnson & Johnson and TPI Enterprises of Australia are lobbying Canberra to be allowed grow opium poppies commercially on the Australian mainland for the first time. GSK has already begun trials in the state of Victoria, which is expected to pass a law decriminalising the growing of poppies in coming weeks. “There is increasing demand for pain relief drugs as the global middle classes expand. But there is a limit on the available land in Tasmania for growing,” said Jarrod Ritchie, chief executive of TPI. “We’ve recently suffered drought and storms in Tasmania and we just can’t get enough crops. The existing monopoly situation is damaging the industry,” he said. Opium poppy plants contain morphine, codeine and thebaine, ingredients in a wide range of common pain killers such as solpadine, as well as in illegal drugs such as heroin. Growing opium poppies is regulated by the UN, which has approved Australia as one of only a handful of countries for legal commercial production.