GOVERNMENT DROPPED TERM 'BANK' FROM SBCI AFTER HONOHAN CONCERNS - The Government dropped the term 'bank' from its Strategic Banking Corporation of Ireland (SBCI) after concerns were expressed by Central Bank governor Patrick Honohan, writes the Irish Independent.
The concerns were revealed in new correspondence between Mr Honohan and Finance Minister Michael Noonan, on the launch of the new banking corporation that the Government initially labelled the 'Strategic Investment Bank'. The Government established the SBCI last year with an initial €800m of funding to be made available in loans for the SME sector. The correspondence - released in response to an FOI request - shows that in a letter to Minister Noonan on July 14, Mr Honohan expressed his "concern and disappointment that the Central Bank was not sufficiently consulted on the development on the Bill", particularly in light of the fact that the Bill proposes to exempt the SBC from the need to obtain a banking licence. Mr Honohan said that if the SBC were to be privatised in the future, the consequence of the Bill "could be the creation of a sizeable unlicensed privately controlled banking corporation exempt from the Capital Requirements Directive (CRD)".
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DALATA SHAREHOLDERS APPROVE €455m HOTELS TRANSACTION - Chief executive of the Dalata hotel group Pat McCann said it may buy about 10 more hotels in Ireland, after its shareholders yesterday rubber-stamped its proposed €455 million takeover of nine British and Irish hotels from the Moran Bewley group. After a shareholders’ meeting regarding the deal, Mr McCann said Dalata “may end up owning about 20” hotels in the Irish market, says the Irish Times. Dalata now owns 11 Irish properties and 16 in total. “We are never going to stop looking at buying opportunities,” said Mr McCann. “There will be more hotels on the market this year, such as the ones in Nama’s Project Crystal. There are still a number of opportunities for us [in Ireland] before we focus elsewhere.” Project Crystal contains about eight hotels, including Fels Point in Kerry and Clonmel Park in Tipperary, both of which are operated by Dalata on behalf of receivers. It also includes the Osprey in Naas and Johnstown House in Meath. Nama said it would bring more hotels to the market “in coming weeks”. The Moran Bewley’s deal, which does not include the landmark Red Cow Moran hotel in west Dublin, remains subject to clearance from the Competition and Consumer Protection Commission.
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DUBLIN OFFICE RENTS TO EXCEED PRE-RECESSION PEAK - Dublin office rents will surpass peak pre-recession levels in the next two years as the lack of development and increasing demand continue to drive prices higher, says the Irish Examiner. The chronic lack of development coupled with increased demand from domestic and overseas occupiers is expected to further inflate rental prices in 2015 and through the following year too, analysts at Davy Stockbrokers are predicting. The residential situation mirrors that of the office market with double digit rental price inflation anticipated over the coming 24 months as an imbalance between supply and demand for prime stock persists. “While market appetite for office development and refurbishment risk has returned, with 56,000 sq m of office development and refurbishment projects under way in Dublin’s central business district, we expect office rents to continue to inflate over the next two years and pass their 2007 peak,” said Davy head of research Barry Dixon. Yields on commercial grade A office space in Dublin now look set to fall 5% in 2015 as prices continue to rise faster than rents, however. In a note covering areas of the Irish and wider global economy, the stockbrokers also outlined their 2015 growth expectations including GDP growth of 3% to 4%.
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ROLLS-ROYCE STRESSES BRAND VALUE AS SALES PURR AHEAD - The head of Rolls-Royce has stressed the need to maintain the British motoring brand’s exclusivity, after reporting a fifth consecutive year of record car sales. In 2014, the BMW-owned business delivered 4,063 vehicles to customers, a 12% increase on the prior year. Sales have now more than quadrupled since 2009. But Torsten Müller-Ötvös, chief executive of the luxury carmaker, said there was an implicit cap on production that would limit output to its current UK capacity of about 6,000 vehicles. “We are not pushing volume,” he said on Monday. “That is a clear priority. We are always building one car less than we can sell.” Most super-luxury carmakers managed to escape the worst ravages of the financial crisis and have since enjoyed a resurgence of demand in the US and emerging markets. That was demonstrated in September when Rolls-Royce sold 30 bespoke Phantom saloons to the Hong Kong entrepreneur, Stephen Fung, for his new Macau gaming complex - known as the world’s most extravagant hotel and casino.
