Morning business news - April 28Monday 28 April 2014 09.55
Last week AIB said it would not able to pay its next interest bill on government rescue loans, which falls due in coming weeks. This means the cost of bailing the bank out went up by a further €280 million.
While no new government money is going into the bank, the failure to repay means our shareholding - as taxpayers - is going to go up very slightly, as the bank will pay in shares, instead of cash. The bank is already 99 per cent government owned.
AIB says the move is in the best interest of the bank and its shareholders.
“It means that either AIB has cynically decided to dilute the value of the shares owned by the taxpayer or they don’t have the cash on hand and don’t want to raise it elsewhere,” said Trinity College’s Brian Lucey.
He said that he expected the bank’s talks with the Department of Finance on this issue to be going “swimmingly” as Government has “been unwilling to push the banks to shape up or ship out” over the past few years.
Mr Lucey said it was most likely that AIB had opted not to pay the interest bill in an attempt to maintain its cash reserves ahead of the European Central Bank’s asset quality review.
Doing this would help make the bank look “as pretty as possible” he said, but if that was the case markets would ultimately see through the move.
“Either way we the shareholders need to be told, upfront and centre, what’s going on,” he said.
Figures from Visa for 2013 show that last year overseas visitors to Ireland spent over €903 million on Visa debit, credit and prepaid cards. That was a 20% higher spend than in 2012.
The daily spend by overseas visitors was worth €2.4 million a day to the Irish economy.
Visitors from Britain and the United States make up the bulk of the foreign money spent here, but per head, travellers from countries in Asia and the Middle East spent more than other nations.
Indonesians spent more per transaction than any other nationality, with an average spend per transaction of €170.71.
After Indoneisans, some of the other top ten big spenders by transaction were visitors from Singapore, Kuwait, and Hong Kong. The Chinese were at number seven and visitors from the United Arab Emirates at number ten.
This week the European Banking Authority is going to disclose details of the scale of stress banks must be able to withstand to pass tests that are due to happen later this year.
The main banks here - AIB, Bank of Ireland, Ulster Bank and Permanent TSB - will be looked at as part of the investigation into the 120 biggest or most locally significant lenders across the euro area.
The head of the ECB's supervisory board chair Daniele Nouy said over the weekend that this year's round of tests will be tougher than in 2011.
And a second Irish data centre for Google has been approved. Dublin County Council has granted planning permission for the new €150m, 30,00sqm, centre beside its existing facility in Clondalkin in Dublin. During construction it is estimated 300 jobs will be supported, with 60 new full-time jobs at the data centre itself.
Google already employs more than 2,500 people in Ireland, mainly in Barrow Street in Dublin 4.
Retail sales in Japan grew at the fastest pace in 17 years last month as consumers rushed to make purchases ahead of the sales tax hike in April.
Sales jumped by 11% during the month, from a year ago - the most since March 1997.
Japan raised its sales tax, also known as consumption tax, to 8% from 5% from 1 April, the first hike in 17 years.
And Irish technology company Diona recruiting 40 high quality new positions following investment of $ 5.5m.
Diona already employs over 90 staff, with last year's revenues hitting €6 million.
The 40 new jobs are in areas like software engineering, services and global business support.