What it says in the papers: business pages
HERE are the main business stories from this morning's papers:
***Banks will be left with no option but to cut extortionate variable mortgage rates after AIB buckled and said it was now likely to reduce its rates within two months.
The AIB change of tack follows a wave of anger on the issue, and will pile huge pressure on other lenders. A cut of 0.25pc is now expected as early as June for the 140,000 variable-rate customers of AIB and its EBS and Haven brands.
AIB boss David Duffy told the Oireachtas Finance Committee the bank is set to reduce the interest on standard variable rates in the next “month or two”.
***A TEAM from the National Treasury Management Agency (NTMA) was ignored in discussions on the night of the government bank guarantee.
Despite being in a room next to the talks for four hours in Government buildings on the night of September 29, 2008, the NTMA representatives were never consulted.
Brendan McDonagh, now head of Nama, but who was Director of Finance at the NTMA at the time, described to the Banking Inquiry how himself and a colleague were left in an adjoining room from 9pm-1am and only told about the guarantee when the decision had been made.
***Tesco’s Irish arm was the worst performer of any of the retail giant’s businesses last year, as the group swung to a massive £6.4bn (€8.9bn) loss on the back of property writedowns. It’s the biggest ever recorded in Tesco’s near 100-year history.
Like-for-like sales in Ireland, including fuel but excluding VAT, fell 6.4pc in the last financial year to €2.55bn from €2.69bn. The difficult performance here also curtailed overall profits at Tesco’s European divisional segment, which does not include the UK.
Tesco recently lost its position as the top grocery retailer in Ireland, yielding the pole position to SuperValu, the brand controlled by Cork-based group Musgrave.
***Developer Paddy McKillen’s plans to swap a potentially controversial development site in Dublin Bay with Blackrock Bowling and Tennis Club has fallen through, the Irish Times reports.
Both sides are said to have gone off the idea of a land swap, which was initially proposed by a third party, the paper reports. However Mr McKillen is set to proceed with plans to develop the 4.9 acre Booterstown site, bought by his father Paddy McKillen last autumn for €1m, potentially including a museum, art gallery and restaurant.
The site straddles both Dublin CIty Council and Dún Laoghaire–Rathdown county council. A local councillor said that locals are likely to oppose development of the area.
***Dublin-based Perrigo has rejected a $29bn (€27bn) bid from generic drugmaker Mylan saying it substantially undervalued the company.
The Irish firm said that the offer of $205 per share was too low and did not take Perrigo’s €2.48bn acquisition of Omega Pharma and new products that are expected to generate about $1bn in revenue into account.
Mylan, which is headquartered in Pennsylvania, makes about 1,400 medications. Its offer for Perrigo represented a 25pc premium over the company’s share price on April 3, the last trading day before the bid was launched.
***One of Europe's leading online fashion stores is to create 200 jobs with a new base in Dublin.
Online fashion retail company Zalando, who made €2.2bn last year, have opened a new tech centre in the capital’s Silicon Docks.
The website has close to 15 million active customers and more than 100 million visits a month, selling fashion clothing, sports gear and shoes for men, women and children.
***Actions against landlords helped the Revenue Commissioners recover an extra €22m last year, according to the body’s latest annual report.
Almost 540 actions were taken against landlords in 2014, with the average settlement being €41,000.
However Taxback.com tax consultant Barry Flanagan warned that many of those affected may be part time landlords who may be unaware of their duties.
***UK betting group Ladbrokes yesterday revealed that it’s struggling Irish operation saw a 1pc dip in revenues during the first three months of the year.
The announcement came after the company announced earlier in the week that it is to seek examinership for its Irish operations and make about 250 of its 840 staff here redundant.
Ladbrokes is now expected to close 60 of its 196 stores here. It said that it is hoping that most of its layoffs can be achieved through voluntary redundancies.
***Profits at the Irish arm of mobile phone giant Vodafone declined 14pc to €100.2m last year.
Accounts just filed with the Companies Office show Vodafone Ireland recorded a €17m drop in pre-profit after revenues slipped 1.4pc to just over €1bn in the 12 months to the end of March 2014.
The accounts show that the Irish arm - headed by Cork native, Anne O’Leary - paid a dividend of €80m to its parent last year following a dividend pay-out of €150m in fiscal 2013.