Today in the press
Updated: Friday, 23 Aug 2013 11:11
ARREARS CRISIS DEEPENS AS 100,000 CAN'T PAY MORTGAGE - The number of homeowners unable to pay their mortgage is continuing to rise despite banks being ordered to deal with the crisis. Close to 100,000 mortgage holders are now three months or more behind on their payments, the Irish Independent has learnt. This is despite six lenders being told by the Central Bank that they will be penalised if they do not tackle the rapidly rising arrears problem. New figures for the three months to June, due out today, are set to show that about 98,000 residential mortgage accounts are now three months or more in arrears. The figures have risen in each quarter over the last four years since the Central Bank began capturing data in September 2009. Close to 13% of all residential mortgages are now 90 days or more in arrears. There had been expectations among financial experts that the arrears figure would begin to taper off after specific targets were set for banks to deal with the problem this year. AIB, Bank of Ireland, Ulster Bank, KBC Bank, Permanent TSB and ACC Bank were ordered to have offered 20% of their customers who are in arrears a long-term solution by the end of June.
GOVERNMENT SPENDING FELL BY €8 BILLION LAST YEAR - Total spending by the State fell considerably last year, while its combined sources of income rose slightly, according to public accounts figures published yesterday by the Central Statistics Office. Despite this, the State still had to borrow more than €1 billion each month in 2012 to finance the gap between spending and revenue, writes the Irish Times. Total Government spending fell by more than €8 billion between 2011 and 2012, to reach €67.2 billion. The fall was attributable to a decline in capital expenditure. Bank recapitalisation costs, at €280 million last year, were a fraction of the €6.8 billion spent in 2011. Last year's spending on bailing out the banks was by far the lowest since the banking crisis began. Other capital spending, on items such as road and bridges, also registered a steep decline, falling from €4.1 billion in 2011 to €2.7 billion last year. At peak in 2008, such investment spending stood at just under €10 billion. Current spending, at €61.9 billion, was unchanged on 2011. Total Government income (excluding monies borrowed) stood at €54.4 billion, an increase of 2.2% on 2011. Receipts, however, remained far below the pre-crisis peak of more than €67 billion.
26 HMV STORES TO OPEN IN XTRA-VISION - Twenty-six new HMV stores are to open around the country as specialist 'shop-in-shop' projects within Xtra-vision outlets in the coming months. British commercial restructuring firm Hilco, which bought both brands from receivership earlier this year, is to announce the locations for the new dual store designs next week says the Irish Examiner. At the same time, the company is planning to make announcements regarding its plans for the redemption of still-valid gift vouchers which controversially weren't honoured during HMV's receivership process, prior to the takeover. Hilco announced its latest plans yesterday when it also confirmed the re-opening of four HMV Ireland stores over the coming weeks. Following successful negotiations with landlords and suppliers, Hilco is to open stores at Dublin's Henry St, Dundrum Shopping Centre and Limerick's Crescent Shopping Centre early next month. The Henry St branch will re-open on September 6, with the other three re-opening a week later. Between them, the four stores will lead to 120 new jobs, recruitment for which has already been completed.
EMERGING MARKETS ENDURE WILD ROLLERCOASTER RIDE - Thursday was another day of turmoil for emerging markets. Unimpressed by the Turkish central bank’s recent efforts to support its currency, investors sent the lira down to a record low against the US dollar; India’s rupee fell to its lowest-ever level; Indonesia’s rupiah dropped to the weakest since 2009. As if that were not enough, Malaysia’s ringgit and Thailand’s baht ended the day in a three-year trough, says the Financial Times. Many central banks have sought to reverse or at least slow the declines by using foreign currency reserves to intervene in the markets. Morgan Stanley estimates that central banks in the developing world, excluding China, lost about 2% of their reserves between May and July. The decline in reserves is driven both by simple outflows of foreign capital and by market interventions. The US Federal Reserve’s plan to reduce its monetary stimulus has spooked investors and driven many to pull money out of the developing world, sending most emerging market currencies tumbling. Although reserves are held precisely for these sorts of squalls, the pace and extent of the declines have been particularly eye-catching in some countries. Indonesia has lost 13.6% of central bank reserves, Turkey 12.7% and Ukraine almost 10%. But India and Brazil, two other countries with struggling currencies, have lost a more moderate 5.5% and 1.8% respectively.