NATIONWIDE SAGA ADDING TO BANKING BITCHING - The former Chairman of the Irish Nationwide Building Society Dr Michael Walsh, it has emerged, had concerns about the institution and said it 'can not survive' without significant Government support. Brendan Burgess, a long-time member of Irish Nationwide Building society and a former member of the Financial Regulator's Consultative Panel, says it is now clear that there are commercial issues at stake in INBS. He points out that Dr Walsh was a professor in banking and finance in an earlier life and should recognise such issues.
Mr Burgess says that two years ago, members of the building society were confidently expecting a windfall of €15,000 each. That has been written off now, he states, and members are not expecting any windfall of all. He says that is down to the 'dithering' of the board for not pushing for demutalisation. The board, of course, included Dr Walsh.
The building society's CEO's son, also called Michael Fingleton, solicited deposits in the London investment community immediately after the Irish Government's deposit guarantee was introduced last year. Nationwide later apologised for that incident.
Justin Urquhart Stewart, of Seven Investment Managers, says the news coming from Nationwide is exactly the type of news we do not want to have at the moment. It says it makes Ireland's reputation worse and adds to the international 'banking bitching' about Ireland that serves very little to give further confidence that firm and direct action about banks is being taken.
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MORNING BRIEFS - Swiss banking giant UBS has agreed to pay $780m and identify certain US clients in a deal to resolve criminal fraud charges that it helped rich Americans to evade taxes. The settlement could expose some UBS customers to Internal Revenue Service scrutiny and law enforcement action. US Justice Department officials said Switzerland's biggest bank had entered what is known as a "deferred prosecution agreement" on charges of conspiring to defraud the US by impeding the IRS, the US tax collection agency.
*** A plan to cut red tape for small businesses in quarter was discussed in Brussels last night by groups representing Irish business, the EU Industry Commissioner Gunther Verheugen and Internal Markets Commissioner Charlie McCreevy. 3.5%t of EU GDP is wasted on administration costs - two thirds of all jobs in Europe are in the small and medium sector.
*** The Bank of Japan kept interest rates on hold today, but said it would extend measures it has already adopted to help support corporate financing, as it battles a credit crunch that is pushing the world's second biggest economy deeper into recession.
*** On the currency markets, the euro is trading at $1.2586 cents and 88.18 pence sterling.
