SMALL BUSINESS WANT BANKS RECAPITALISED - Bank of Ireland's share price fall below a euro for the first time yesterday has renewed concerns that the Irish banks, in addition to their state savings and deposits guarantee, will need cash in the form of billions of taxpayers money to recapitalise. Several business groups have called for the recapitalisation to be hurried along, saying that small business is being put out of business by bank's credit tightening, and that many are going to collapse.
Sean Murphy, head of policy at Chambers Ireland, says the country is now realising that the building boom is over and a huge amount of businesses - architects, auctioneers, builders and furniture shops - are seeing a massive decline in volumes of sales. With the decline in economic confidence, small businesses are also finding it more difficult to get additional loan arrangements in place or additional cash flow support from their banks. He says the larger firms tend to have deeper pockets and can fund themselves better through the peaks and troughs compared to SMEs.
He says that small businesses, especially in the border counties, are seeing challenging conditions. Businesses in such areas as Letterkenny and Dundalk are paying more local authority charges, they are paying higher wages and have higher costs in the South while also having to deal with the sterling issue. Mr Murphy says that the whole Irish economy is refocusing on costs.
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Plumbing and building supplies firm Wolseley today announced plans to cut 2,000 jobs and close more than 200 branches in the UK. Wolseley owns the plumbing, heating and builders supply stores Heat Merchants, Tubs and Tiles and Brooks in Ireland. The Reading-based firm, which also trades as Plumb Center and Build Center in the UK, said the moves reflected its expectations for a further decline in trading. The company also shed 5,050 positions between August and the end of October, mainly in North America. Wolseley, which operates more than 1,900 branches in the UK and Ireland, said the latest job cuts would be phased over the next few months.
*** Rents have fallen to their lowest level since August 2006. According to the latest rental report from property website Daft.ie, rents fell by 3% in the last three months across the country. Daft says this is down to a dramatic increase in the number of properties available to rent. At the start of November, there were over 18,000 properties available to rent nationwide, an increase of 133% on the same period last year.
*** Recession in Japan, which was acknowledged yesterday, could last even longer than feared, its economy minister warned today. This saw shares on the Nikkei in Tokyo drop by over 2%. And this morning in Hong Kong the Hang Seng is almost 3 per cent lower.
*** Figures grew again for tax returns being filed electronically this year. By last night's deadline of midnight just over 303,000 income tax returns were filed through ROS, or Revenue's Online Service, an increase of nearly 9% on last year. In past years the system has been overloaded on the days leading up to the deadline, but yesterday almost 43,000 returns were filed successfully, with the overall online payment reaching €1.63 billion.
*** On the currency markets this morning, the euro is trading at 83.94 pence sterling and $1.2585.
