The Irish Times reports that a Bank of Ireland customer has secured a settlement on mortgage debt allowing her to repay the bank €18,000 – at a rate of €250 a month for six years – to settle an outstanding debt of €170,000.
Laura White, a 35-year-old nurse from Dublin, agreed a deal with the bank on Monday, settling a case taken over a shortfall arising from the sale of a house she voluntarily surrendered in 2009.
The settlement means she will not have to repay the remaining €152,000 but she will be prohibited from borrowing for six years and faces a €120,000 judgment if she fails to make the repayments.
This is one of the first settlements of mortgage debt to come to light in which one of the country’s main banks has written down mortgage debt to a level the borrower can afford to repay.
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The Financial Times reports that The rating agency Standard & Poor’s has cut the sovereign credit rating of Spain by two notches and placed the country on a negative outlook, saying it also expected the country’s economy to contract during 2012 and 2013.
S&P said on Thursday that Spain’s budget trajectory was likely to deteriorate against the backdrop of a deteriorating economy and that the country may need to supply further fiscal support for its banking sector. S&P lowered the country’s long and short-term rating to triple B plus/A2 from A/A-1, near the lower end of investment-grade quality.
“The negative outlook on the long-term rating reflects our view of the significant risks to Spain’s economic growth and budgetary performance, and the impact we believe this will likely have on the sovereign’s creditworthiness,” said S&P in a statement.
The Irish Independent reports that banks in the European Union may win a partial reprieve from Basel capital and liquidity rules if lenders in other regions, such as the US, are allowed to escape the full force of the measures.
EU lawmakers are weighing safeguards to prevent lenders in the region from being left at a competitive disadvantage when a global accord by the Basel Committee on Banking Supervision is implemented, according to a document obtained by Bloomberg News.
The overhaul of capital and liquidity rules, known as Basel III, was designed to prevent a re-run of the crisis that cascaded across financial markets after the collapse of Lehman Brothers Holdings Inc in 2008.
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The Irish Examiner reports that An Post’s traditional business of delivering letters declined last year as did the company’s profits — tumbling from €5.8m in 2010 to €2.2m last year.
In order to improve the profitability of An Post, the company has embarked on a cost-cutting scheme which saw the company reduce pay costs by €15.4m.
These savings were made through a full-time equivalent staff reduction of 300 by way of a voluntary exit scheme. The next phase involves a further employee full-time equivalent reduction of up to 1,500 by the end of 2016.
An Post chief executive Donal Connell’s pay package fell by €5,000 from €500,000 to €495,000, as the pay cut only came into effect in May.
He has since accepted a 15% pay cut imposed by the finance minister.
Mr Connell also waived his entitlement to a 25% short-term bonus but a decision on whether he will be allowed to keep his €97,000 bonus accrued over his service has yet to be taken.
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