HARD BREXIT COULD REDUCE GDP  BY UP TO 7% - The UK’s departure from the European Union could cause almost as much damage to the Irish economy as the financial crisis of 2008-2009, but over a longer period, an expert report has found.

Brexit will reduce the size of the Irish economy in 2030 by between 2.8-7%, depending on the type of Brexit that eventually emerges, an expert study for the Government has found. The study, by Copenhagen Economics, has modelled the effect on the Irish economy of the different types of possible Brexit. Its findings have been circulated to Ministers, says the Irish Times. Although it says the Irish economy will continue to enjoy strong growth over the coming period despite the effects of Brexit, by 2030 the economy could be as much as 7% smaller than its likely size had Brexit never occurred, the study finds. This is comparable to the damage to the economy caused by the financial crisis and the economic crash, the report says, which reduced the size of the economy by 8%. The report modelled four different types of Brexit. All involved variations on a hard Brexit, with the UK leaving the existing EU customs union and the single market.

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LOANS TO MOTORISTS RISE TO €1 BILLION DESPITE FALL IN NEW CAR SALES - Banks owned by car companies loaned almost €1 billion to Irish motorists last year.

The 'big three' - BMW, Renault and Volkswagen banks - recorded increases of between 1.5% and 7%, according to figures obtained by the Irish Independent. The increase in total lending volumes (to almost €950m) came despite the fact there was a 10.4% fall in new car sales last year. The rise appears to reflect industry sentiment that people are increasingly financing their cars through such lending institutions - as well as opting for higher-spec, more expensive models. There also appears to have been an increase in the number of people taking out personal contract plans (PCPs). The latest figures show Volkswagen Bank loaned €500m in 2017 - an increase of 7% on 2016. That pushes its total auto-finance lending, since it started here in 2008, to €2.3 billion. Its PCP mix for last year was 55%. BMW Financial Services loaned €231.7m through its group-brand retailer network and its several multi-make Alphera outlets. The sum represents just a 1.5% increase on the previous year, but that has to be taken as a positive considering the total new car market was back by such a significant amount year-on-year.

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WALL STREET BLAMES TURMOIL ON INSURERS' VOLATILITY STRATEGY - Wall Street is pointing the finger at insurance companies as an unlikely but pivotal source of the turbulence that wiped trillions of dollars off stock market values in recent days.

While complex volatility-linked funds and algorithmic traders have been widely blamed for the wild price swings, strategists and investors said a significant portion of the selling could be traced to variable annuities, a popular tax-advantaged insurance-company product that offers customers guaranteed returns. US life insurers suffered losses on variable annuities in the financial crisis. Since then, insurers have responded by marketing variable annuities that put customers’ money into "managed volatility" funds. These vehicles, which aim to produce steadier returns, shed risky assets when volatility spikes, says the Financial Times. Providers of the biggest such funds include the MetLife spin-off company Brighthouse, AIG's SunAmerica and Columbia Threadneedle, part of Ameriprise, according to the variable annuity specialists Soleares Research. Bridgewater, the world's biggest hedge fund, estimates that there is about $350 billion invested in "managed volatility" accounts. Aaron Sarfatti, partner at Oliver Wyman, estimated managed volatility funds - also known as "target vol" funds - sold $80 billion to $100 billion of stock futures in recent days.

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UNILEVER THREATENS TO PULL ADS FROM FACEBOOK AND GOOGLE - The consumer goods multinational Unilever is threatening to withdraw its advertising from online platforms such as Facebook and Google if they fail to protect children, promote hate or create division in society.

In a speech later today, Keith Weed, the Unilever chief marketing officer, will say that, as a brand-led business, Unilever "needs its consumers to have trust in our brands". Unilever is the world's second largest marketing spender, after Procter & Gamble, and spent €7.7 billion last year advertising its brands, which include PG Tips, Marmite, Dove and Persil. The company has trimmed its ad production as part of a cost-saving drive; it is making fewer TV ads and has halved the number of ad agencies it uses to 1,500, writes today's Guardian. Weed will tell major advertising, media and technology companies gathered at the annual Interactive Advertising Bureau conference in Palm Desert, California: "As one of the largest advertisers in the world, we cannot have an environment where our consumers don’t trust what they see online. And we cannot continue to prop up a digital supply chain - one that delivers over a quarter of our advertising to our consumers - which at times is little better than a swamp in terms of its transparency."