What it says in the papers: business pages
HERE are the main business stories from this morning's papers:
***AIB cannot cut the cost of standard variable rate mortgages because it needs to ensure the bank’s future financial health, outgoing chief executive David Duffy is expected to signal today.
Mr Duffy will tell TDs and Senators on the Oireachtas Finance Committee that claims the bank is borrowing at almost no cost are an “overly simplistic” assessment.
Meanwhile, Permanent TSB (PTSB) warned potential investors that a return to profit may be at risk from political pressure to cut interest rates and a UK exit from the European Union.
***Taoiseach Enda Kenny has told US billionaire Donald Trump that the Government is “very conscious” of his concerns surrounding the potential sale of the State’s shareholding in Aer Lingus.
Mr Kenny said issues surrounding transatlantic links and connectivity via Heathrow Airport were being closely considered as negotiations with the International Airlines Group (IAG) enter its most critical phase.
The Taoiseach made the pledges in correspondence with the high-profile businessman which has been released under the Freedom of Information Act.
***UK betting group Ladbrokes will axe 250 jobs in Ireland after the company put its business here into examinership.
Ladbrokes said an interim examiner had been appointed to “safeguard” the loss-making Irish operation.
The company employs 840 people in Ireland across 196 shops. It’s believed that 60 of its Irish outlets will be closed, resulting in the loss of 250 jobs.
***AIB had moved to repossess over 5,700 homes in mortgage arrears by the end of the year, the Irish Times reports.
Figures supplied to the Oireachtas finance committee also reveal a further 3,871 homes were at risk of being repossessed at the end of last year.
The paper reports that the document shows that AIB has started proceedings against over 1,500 buy-to-let properties. The bank is due to appear before the committee today.
***Belmond Limited, the company behind the world-famous Orient Express, is to launch an Irish luxury train to cater to some of the wealthiest people in the county.
The ‘Belmond Grand Hibernian, refitted from 11 carriages acquired from Irish Rail at a cost of €9.3m, is to be a luxury sleeper train with 20 en-suite cabins that will be able to carry 40 passengers at a time.
It is set to start offering train holidays in Ireland in August 2016.
***Irish banking executive John Hourican has resigned his role as CEO of Bank of Cyprus, the Irish Times reports.
Mr hourican took on the position in the bank in November 2013, cutting 1,450 staff as he looked to reverse its fortunes Cyprus’ debt crisis. The bank has now returned to profitability and passed recent European banking stress tests.
He also firmly ruled out taking over from David Duffy as AIB chief executive, telling the paper that he is “not involved in any process for any job in Ireland at this stage.”
***Permanent TSB Group Holdings has warned potential investors that a return to profit may be at risk from Irish political pressure to cut interest rates and an U.K. exit from the European Union.
PTSB may be forced to lower its existing 4.5pc standard variable rate on mortgages because of mounting political, regulatory or competitive pressure, the Dublin-based lender said in a 132-page capital raising document obtained by Bloomberg News.
State-owned PTSB is seeking to sell €400m of equity and €125m of so-called additional Tier 1 bonds to shore up its capital after failing European stress tests last year.
***Dublin-based Smurfit Kappa, which has a market capitalisation of around €6.5bn, has agreed a deal to sell off a tranche of its foreign assets for €42m.
The Aurelius Group is picking up the solid board and graphic board operations of the Irish corrugated packaging company that are located in the Netherlands, Belgium and the UK.
The operation, which has around 830 employees, delivered revenues of over €240m and EBITDA of €14m in 2014.
***State-owned Allied Irish Bank (AIB) has pocketed €250,000 from the €295,000 sale of one of independent TD Mick Wallace’s main firm’s four Temple Bar apartments, new figures show.
The apartment at 43 East Sussex Street was part of a group of four apartments that once had a value of €2.5m and were formerly owned by Deputy Wallace’s main firm, M&J Wallace Ltd.
AIB appointed Gerry McInerney of McInerney Saunders of Swords as receiver to certain assets of M&J Wallace Ltd in 2012.