NOW BURN BONDHOLDERS IN ANGLO, SAYS HONOHAN - Central Bank Governor Patrick Honohan wants to burn Anglo Irish Bank junior bondholders and save the taxpayer up to €300m, the Irish Independent can reveal.
But the Government isn't optimistic and is cautioning about the legal difficulties of a final attempt to recoup some of the almost €30 billion injected into the toxic bank. In one of his last acts before announcing his retirement, Professor Honohan urged the Government to fight the legal case. And he has advised the Coalition to go as far as hiring one of the world's top debt lawyers, described as a "fairy godmother to finance ministers in distress". The governor is telling the Department of Finance to block payments to junior bondholders in the now defunct lender. In emails to one of Finance Minister Michael Noonan's top officials, Professor Honohan said the "moral case" for ensuring that the surplus money from the liquidation of IBRC is returned to the taxpayer is "almost unassailable". The governor argued that while the sum involved isn't big in the grand scheme, it is still "worth a big legal battle".
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IRELAND NEEDS A WELL-DEVELOPED RENTAL MARKET - CENTRAL BANK - Ireland needs to develop a broader and deeper rental market in order to protect itself against future financial shocks, deputy governor of the Central Bank Stefan Gerlach has said. Speaking at the Dubrovnik Economic Conference in Croatia, Mr Gerlach said it has been shown that economies with deeper rental markets suffered less in the financial crisis, writes the Irish Times. “Overall, a deep and well-established rental market... seems to be a mitigant against the effect of shocks to the broader economy and housing markets,” he said. In Ireland and Croatia on the other hand, “credit-fuelled housing bubbles played a big part in both countries’ pre-crisis growth and subsequent decline”. As such, Mr Gerlach said that it would be important for countries like Ireland to promote a “well-developed rental market as a genuine alternative to ownership, and an attractive investment proposition for potential landlords”. “While many households may continue to buy rather than rent, we need to make sure that this choice reflects their preferences and does not merely reflect a poorly functioning rental market,” he said. Mr Gerlach said that culture was a factor, but also identified other issues included “the type, quality, affordability and, in particular, security of tenure of private rented accommodation”. Ireland has the fourth lowest rental rate in Europe, at 26%, behind Hungary, Spain and Greece. Switzerland (+60%) and Germany (54%) are at the other end of the scale.
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CRUISE BERTH PLAN TO SAVE DUN LAOGHAIRE PORT - A multi-million bid to safeguard the future of one of the country’s busiest ports is due to be lodged with An Bord Pleanála. The controversial planning application, which has sparked opposition from residents and local political representatives, is being submitted by Dun Laoghaire Harbour Company to An Bord Pleanála. The Harbour Company is seeking planning permission for an €18m cruise berth facility to cater for massive cruise ships, which would mean passengers will be able to walk onto the port resulting in a much needed financial boost to the local economy, says the Irish Examiner. The port has been left idle of commercial ship terms since Stena Line Ferries pulled services earlier this year, citing the need to concentrate its business out of Dublin Port, located 12km away. The service was reduced to a seasonal operation five years ago. The Harbour Company said it hopes a replacement passenger service would be in place for next year. To date nine expressions of interest in this service have been made by international shipping companies.
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G7 IN HISTORIC ACCORD TO PHASE OUT FOSSIL FUEL EMISSIONS THIS CENTURY - The Group of Seven industrial powers have agreed the world should phase out fossil fuel emissions this century, in a move hailed as a historic decision in the fight against climate change. G7 leaders meeting in Bavaria, Germany, said that in line with scientific findings, “deep cuts in global greenhouse gas emissions are required with a decarbonisation of the global economy over the course of this century”. The leaders of the US, Germany, France, the UK, Japan, Canada and Italy said they supported cutting greenhouse gases by 40-70% by 2050 from 2010 levels - the first time they have backed such a precise long-term target. Angela Merkel, the German chancellor, said the cuts would have to be at the upper end of this target because “40% is clearly not enough”, writes the Financial Times. The leaders also reaffirmed a pledge to mobilise $100 billion a year from public and private sources by 2020 to help poorer nations tackle climate change. Climate campaigners said the decisions taken by the world’s wealthiest democracies would boost negotiations among nearly 200 countries aimed at finalising a global climate deal in Paris in December.
