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• There’s Hole in my Euro: A little euro xmas ditty courtesy of Donal O’Mahony of Davy

  December 19, 2011 @ 10:32 am | by John McManus

  
  

  There’s a Hole in my Euro

  
  

  There’s a hole in my euro, dear Angie, dear Angie,

  There’s a hole in my euro, dear Angie, a hole.

  Then fix it, dear Nicky, dear Nicky, dear Nicky,

  Then fix it, dear Nicky, dear Nicky, fix it.

  With what shall I fix it, dear Angie, dear Angie?

  With what shall I fix it, dear Angie, with what?

  With EFSF, dear Nicky, dear Nicky, dear Nicky,

  With EFSF, dear Nicky, dear Nicky, EFSF.

  EFSF is too small, dear Angie, dear Angie,

  EFSF is too small, dear Angie, too small.

  Then lever it, dear Nicky, dear Nicky, dear Nicky,

  Then lever it, dear Nicky, dear Nicky, lever.

  Will ECB help lever, dear Angie, dear Angie?

  Will ECB help lever, dear Angie, will it?

  Nein nein shall it lever, dear Nicky, dear Nicky,

  Nein nein shall it lever, dear Nicky, nein nein.

  Then how shall we lever, dear Angie, dear Angie?

  Then how shall we lever, dear Angie, just how?

  Sell insurance, dear Nicky, dear Nicky, dear Nicky,

  Sell insurance, dear Nicky, dear Nicky, insurance.

  Investors won’t buy it, dear Angie, dear Angie,

  Investors won’t buy it, dear Angie, won’t buy.

  Then call IMF, dear Nicky, dear Nicky, dear Nicky,

  Call IMF, dear Nicky, dear Nicky, IMF.

  But Chrissy’ll need funding, dear Angie, dear Angie,

  Chrissy’ll need funding, dear Angie, funding.

  Try G20, dear Nicky, dear Nicky, dear Nicky,

  Try G20, dear Nicky, dear Nicky, G20.

  EU must give first, dear Angie, dear Angie,

  EU must give first, dear Angie, EU.

  E200bn tops, dear Nicky, dear Nicky, dear Nicky,

  E200bn tops, dear Nicky, dear Nicky, E200bn.

  We’ll still need more, dear Angie, dear Angie,

  Still need more, dear Angie, need more.

  ESM so, dear Nicky, dear Nicky, dear Nicky,

  ESM so, dear Nicky, dear Nicky, ESM.

  With EFSF alongside, dear Angie, dear Angie?

  EFSF alongside, dear Angie, alongside?

  The same cash ceiling, dear Nicky, dear Nicky,

  Same cash ceiling, dear Nicky, the same.

  Then kill PSI, dear Angie, dear Angie,

  Then kill PSI, dear Angie, kill it!

  Need fiscal compact, dear Nicky, dear Nicky,

  Need fiscal compact, dear Nicky, then yes!

  Can’t lose my sovereignty, dear Angie, dear Angie,

  Just can’t lose my sovereignty, dear Angie, I can’t!

  Will save you the allusion, dear Nicky, dear Nicky,

  Will save you the allusion, dear Nicky, allusion.

  Johnny Bull won’t wear it, dear Angie, dear Angie,

  Johnny Bull won’t wear it, dear Angie, won’t wear.

  Don’t need him, dear Nicky, dear Nicky, dear Nicky,

  Don’t need him, dear Nicky, dear Nicky, just don’t.

  Will “other elements follow”, dear Angie, dear Angie?

  Will “other elements follow”, dear Angie, will they?

  May Draghi their feet, dear Nicky, dear Nicky,

  May Draghi their feet, dear Nicky, Draghi.

  Then still a hole in my euro, dear Angie, dear Angie,

  Still a hole in my euro, dear Angie, a hole.

• Business ♥ this budget

  December 6, 2011 @ 8:36 pm | by John McManus

  No doubt about it…

  Some chinks of light for technology industry in Budget 2012 – Deloitte

   Budget 2012 tax measures are Business Aware – Chartered Accountants Ireland

  2% stamp duty rate to attract foreign investors – Deloitte

  Irish Tax Institute says export led tax measures will help Irish companies target international markets

  Lowering of Commercial Stamp Duty will Stimulate Moribund Property Market – Dublin Chamber

  Decision not to reduce the current level in tax relief on pension contributions welcomed by Aviva Ireland

  We warmly welcome the commitment today by Minister Noonan that legislation will be introduced in 2012 to address the issue of very cheap alcohol – Vintners’ Federation

  Surveyors say measures in Budget 2012 will stimulate activity in property and construction sector;

  Institute of Directors in Ireland welcomes Government supports for business in Budget 2012

  The Irish Exporters Association(IEA) Welcomes Minister Michael Noonan’s Budget 2012 – Stating it Will Provide Major Boost to Export Growth Prospects

  CIF: property market measures welcome but mixed budget for construction

• And the winner is….

  @ 8:05 pm | by John McManus

  This year’s budget lottery winer is a key talent attracted to Ireland for business expansion purposes  who spends 60 days a year in any of  Brazil, Russia, India, China & South Africa, whilst engaged in r&d activities. He/she would  qualify for three separate tax breaks.

   Ideally they should earn less than €10,036 – to be exempt from the universal social charge – and be looking to buy a house this year, if not a commercial property. to avail of a range of tax concessions.

  Oh yes…if they had a relation looking to sell then the family farm, this is also their  year as various measures to encourage farming and the transfer of farms were announced.

  The losers are all householders, even those very rich ones who don’t live here and have tried to avoid the domicle tax buy dumping their Irish passports.  They can also look forward to paying more to tax their environmentaly friendly beemer and  more DIRT on their savings…..

  Dont beleive us….read the following from PwC………..

  On Personal Tax
  On Personal tax, Mary O’Hara, HR & Reward Partner, PwC said “Given the amount of speculation and leaks in advance of Budget 2012, there was probably more good news than bad for individual taxpayers. On personal tax, the Government did stick to their promise of no changes in income tax rates or credits. In addition, a number of measures designed to incentivise employment were announced. These include:

  •  
    • A special assignee relief programme to attract key talent to Ireland for business expansion purposes, which will be welcomed both by multinationals and indigenous employers
    • Tax relief where an individual spends 60 days a year developing markets for Ireland in Brazil, Russia, India, China & South Africa, which will clearly be welcomed by exporters
    • A scheme for delivering tax efficient bonuses to individuals involved in R&D activities, which should go some way to addressing CEOs’ concerns over the retention of key talent.

  Mary O’Hara also commented that there was good news for certain categories of individuals, including:

  •  
    • Those earning less than €10,036, who will benefit from an exemption from the Universal Social Charge from 1 January 2012 house buyers during 2012, who will benefit from enhanced mortgage interest relief (25% for first time buyers and 15% for others).

  Along with the €100 charge for all householders, a number of other areas targeted for less favourable treatment include:

  •  
    • The domicile levy, which has come under the spotlight, with the removal of the citizenship requirement motoring, with increased motor taxation from 1 January 2012 and the threat of a VRT review savings, with increased DIRT deductions (up from 27% to 30%)”

  On VAT
  On VAT Tom Corbett, VAT Partner, PwC said “The increase in VAT rate from 21% to 23% from 1 January 2012 will present challenges for businesses to implement the required pricing, documentation and systems changes in the short timescale. It is critical that steps are taken immediately in order to be ready for the new year.”

  On business tax/corporate tax
  On business tax, Jean Delaney, Tax Partner, PwC said ” the Minister’s plans for encouraging focus on emerging markets, dealing with high value skills shortages and driving innovation are to be welcomed”. On corporate tax, Jean Delaney added “that the Minister affirmed again the Government’s commitment to the 12.5% tax rate while introducing changes to the R&D tax credit regime designed to encourage SME’s in particular”.

  On Pensions
  On Pensions Alan Bigley, PwC Pensions Partner, said “The Minister has introduced a relatively small number of revenue generating measures in the Pensions area principally around distributions from ARF’s and the full abolition of employer PRSI relief on employee pension contributions.

  However despite signals to the contrary there have been no further reductions in the Standard Fund Threshold or the tax relief applying to pension contributions.

  The Minister has stated that incentives for supplementary pension will have to be reformed.

  We would see these reforms as possibly including:

  • Further reductions in the Standard Fund Threshold.
  • Reductions in tax relief on contributions.
  • Possible retention of the pensions levy.

  It is unfortunate that we have continued uncertainty in the regime which will apply to taxation of pension savings in the medium term. Pension savings are a long term commitment and individuals need to have certainty as to the taxation regime which will apply to these commitments.

  On stamp duty/capital gains/property
  On stamp duty and capital gains tax, Tim O’Rahilly, Tax Partner, PwC said “The Minister has reduced the top rate of Stamp Duty on commercial real estate from 6% to 2%. In addition, he has introduced a Capital Gains Tax exemption for property purchased between today and 31 December 2013 provided the property is held for seven years. There measures are very welcome as they make Irish real estate relatively attractive from a tax perspective for Irish and international investors. “

   .

• Out-foxing new media: telly tales from the US

  November 18, 2011 @ 2:25 pm | by Simon Carswell

  On a visit to New York last week, I had an interesting conversation with Dennis Swanson, a 50-year veteran of the US television industry who is president of operations at Fox Television Stations. He manages 27 US stations and about 4,000 staff across the Fox network, part of Rupert Murdoch’s News Corporation. (He only agreed to an interview on the basis that I wouldn’t ask him about the phone hacking in the UK – not ideal, I know, but he was an interesting bloke.)

  A man who is very proud of his Irish roots and the fact that his ancestors hail from Co Mayo in particular, Swanson is president of the Ireland-US Council, the business association which held its annual dinner in Manhattan last week.

  He told me a great story of how he gave an up-and-coming host her first television show in Chicago in 1983.

  At the time, Swanson had been working for ABC television in Los Angeles and was asked to take control at the network’s flagging station in Chicago. The station’s morning show was bottom in the ratings. A producer showed him a tape of a young woman from Baltimore named Oprah Winfrey. (more…)

• Can Ireland beat Chile (on bank bailout costs)?

  November 17, 2011 @ 4:11 pm | by Simon Carswell

  Alan Ahearne, the former economic adviser to the late Minister for Finance Brian Lenihan, produced some interesting figures at a conference in Dublin yesterday morning that are worth reproducing here.

  Ahearne, who is back teaching and researching at NUI Galway after his stint in the “war-room” in the Department of Finance, listed the costs of the worst banking crises as a proportion of GDP and compared the gross costs (what Ireland and other countries spent bailing out banks) and the net costs (after what the other countries recovered from the sale of bank stakes and assets). Here’s the table he produced from a research paper that he is working on.

  

  The figures show that the Irish banking crisis has been the most costly on record based on gross costs.

  “We want to do a Chile on it, not an Indonesia,” Ahearne told the Irish Association of Corporate Treasurers conference in a Dublin hotel.

  Asked later how much of the upfront (gross) bailout cost he thought the Irish State would recover, Ahearne said: “I have no idea – it depends on how the economy goes and what happens to the property market.”

  A “good chunk” of the €29.3 billion injected into Anglo Irish Bank would never be recovered, he said, and that it was “unknowable” how much of the €20.7 billion pumped into Allied Irish Banks would be recouped.

  Looking at the overall figures again, the Government has injected/committed €62 billion of public money (so far) to the Irish banks.  It remains to be seen whether further cash is required at Irish Life and Permanent, depending on how much the State can save from the sale of Irish Life. Of the €24 billion required under the latest recapitalisation bill, a saving of €7 billion was made from burning more junior/subordinated bondholders. This saving also includes the €1.1 billion injected by the Canadian-led group of  private investors for a 35 per cent of Bank of Ireland (compared with the €4.2 billion invested by the Government for a 15 per cent stake).

  So clearly the Irish banking rescue has come a long way since October 2008 when it was described by Lenihan as “the cheapest bailout in the world so far”.

• Mourning over the Anglo $1bn bond “tombstone”

  November 7, 2011 @ 5:46 pm | by Simon Carswell

  

  You gotta love the language used by financial hotshots. This is a good and timely example. It is a photograph of the “tombstone” of the controversial $1 billion (€720 million) senior Anglo Irish Bank bond that was repaid last week to the mostly risk-taking hedge funds and investors in distressed debt. Many made a killing, buying in at a deep discount earlier this year and netting a windfall when the debt was repaid in full by the State-owned bank. The trophy is nicely placed between a bull and a bear to reflect how markets move. (It’s certainly difficult for the public to bear this bull.)

  In investment banking, a client is presented with “tombstone” – also known as a “deal toy” – to mark the closing of a business deal. They are often customised for the client. In this case, the trophy was designed around Anglo’s arrowhead logo.  It’s worth noting from the trophy that the institutions which sold this five-year bond – the so-called “book-runners” – when it was issued in November 2006 were US bank Citigroup and Japanese bank Nomura.

  There is no better item than a “tombstone” to commemorate last week’s transaction. This dead bank Anglo (being run down as  Irish Bank Resolution Corporation) is bequeathing cash to senior unsecured unguaranteed bondholders at 100 cent in the euro.  Now that is something to mourn.

• Business podcast: June 2nd

  June 2, 2011 @ 7:40 am | by John Collins

  John Collins talks to Castlepalooza promoter Cillian Stewart, hears from Barry O’Halloran about Harland & Wolff’s green transformation and discusses Ireland’s digital progress with Alto chair Ronan Lupton.

   

   Standard Podcast [24:46m]: Play Now | Play in Popup | Download
  

• Business Podcast: DCU enterprise advisory board

  May 20, 2011 @ 7:30 am | by John Collins

  Business editor John McManus hosts a special podcast with members of DCU’s Enterprise Advisory Board; Professor Brian Mac Craith, President DCU; Tony Donohoe, Education & Research, IBEC; Clare Duignan, Managing Director, RTÉ Radio and Paula Neary, Partner, Accenture.

   

   Standard Podcast [19:18m]: Play Now | Play in Popup | Download
  

• Business podcast: April 28th

  April 28, 2011 @ 10:29 am | by John Collins

  Dan O’Brien on the EU/IMF bailout, ICAD president Pearse McCaughey on advertising creativity, Derek Scally on the opening of Germany’s labour market and Neil Leydon on encouraging entrepreneurship.

   

   Standard Podcast [32:45m]: Play Now | Play in Popup | Download
  

• Amarin finally walks the walk

  April 18, 2011 @ 9:53 pm | by Dominic Coyle

  Everyone loves a winner….almost four years to the day that the company’s highly touted Huntington’s drug collapsed in a clinical trial, Amarin earlier today announced results of a trial of the same compound but for a very different condition. And this time, it has hit all targets and more.

  The stock market reaction was immediate. Having traded at $8.87 last Friday, it opened yesterday at $16.44. At its peak, the shares touched $17.44 before closing the day at $17.10.

  The weight of interest behind the stock showed in the volumes. Last Friday, 8.83 million shares in the Irish-based drug developer traded, itself notably ahead of the 1.9 million daily average over the past three months. Yesterday, just shy of 53.5 million shares changed hands.

  A company that was worth a mere $25 million back in October 2009 when Fountain Healthcare led a $70 million funding round that financed the latest clinical trials is now worth $1.82 billion.

  And no-one is talking down the prospects of this Elan spinoff. The market for treatment of elevated triglycerides – a type of fat stored from food intake and released as energy which at elevated levels are seen as increasing the risk of heart disease – is large and growing. Forty million patients in the US alone, Amarin says.

  Even better, from the company’s view, is that there is no authorised product to match this need. GlaxoSmithKline’s Lovaza is licensed to treat only those with very high triglyceride levels – a group itself said to number four million in the US alone – and it has been notching up sales of around $1 billion a year.

  In a further boost, not only is Amarin seen as extremely safe with no serious adverse side effects during the trials, but its also performs without increasing the level of low density lipoprotein (LDL-C or “bad cholesterol”), a factor which is an issue for Lovaza.

  Manus Rogan, the managing partner of Dublin-based Fountain Healthcare and, since leading the 2009 investment round an Amarin director, said AMR1010 was “firmly on track to become a multibillion dollar blockbuster”.

  The question now is whether chief executive Joe Zakrzewski can deliver on his determination to commercialise such a major drug inhouse or whether it will partner one of the big pharma players. There will be no shortage of suitors. Glaxo itself is facing patent expiry on Lovaza; then there is Pfizer where much of the R&D team behind AMR101 originated from. Given the dearth of pipeline blockbusters, you could run through most of the major industry players.

  Then again, big pharma may fancy more than a partnership. The one thing they are rich in is cash and, as a small, one drug company, Amarin would be seen by many in the industry as a clean takeout, delivering a bumper payout to those who stuck with the stock when it was down and out and those who have invested along the road to recovery.

  Of course, before then, the company needs to get its NDA into the Food and Drug Administration and secure authorisation to market to the broad elevated triglycerides market. That is likely to take a few months yet

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