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FBD benefits from 'limited' relationship with Bloxham

Insurance company FBD would hardly be best pleased seeing its name dragged into the mess that is the closure of stockbroking firm Bloxham amid allegations of accounting irregularities and various investigations.

The publicly quoted insurer, which owns 11.6 per cent of the firm, can trace its involvement in Bloxham back to 1988 when it merged with Maguire McCann Morrison, in which FBD had a 29.9 per cent interest.

Maguire joined forces with rival firm Bloxham Toole O’Donnell, both of which could trace their origins back to the 1840s.

Even at the time of the 1988 merger, FBD was a “limited partner”.

This historical arrangement, making the insurer something of a silent partner in the firm, has now saved FBD a potentially costly bill.

The “limited” status means that the firm has no exposure to liabilities or any shortfall at Bloxham arising from its closure or claims of more than €20 million from investors arising over the disastrous “Saturn” investment bonds.

FBD had neither oversight of what the firm was doing within its offices in the IFSC in Dublin nor any director representation in the Bloxham partnership, according to a source close to the insurer.

The individual partners of Bloxham will, however, have to deal with any shortfall due to their membership of this unlimited partnership, which owned the firm.

These include financial partner Tadhg Gunnell, who was suspended by the firm last week over the alleged financial irregularities.

The broker’s auditor, Deloitte, meanwhile, is said to be none the wiser as yet about the nature of the irregularities. Gunnell was previously one of its own, having worked there for three years prior to joining Bloxham in 2000.

The accountants have not yet been interviewed by the Central Bank or Bloxham’s investigator, KPMG, but are understood to be ready and willing to answer questions.

Given how far the irregularities supposedly date back, there could be some awkward questions.

Farmers seeking small-business credit till the cows come home 

It hasn’t gone away, you know. While the issue of credit for small businesses has receded somewhat from public debate over the past few months, Irish Farmers’ Association (IFA) president John Bryan put the issue firmly back on the agenda earlier this week.

Speaking at a seminar organised by Bank of Ireland in Kilkenny on Tuesday, Bryan highlighted the fact that farmers were increasingly facing an unreasonable delay and bureaucracy in accessing finance from banks.

While the plight of farmers may not elicit much sympathy from other small-business owners or sole traders in light of the generous direct payments they receive from Europe, working capital and money for investment is a crucial cog in the wheel of the agri-sector.

After all, agriculture is one of the few sectors of the economy that is expanding. It is also especially important for an industry that is gearing up for major expansion.

The ambitious growth targets set out in the Government’s blueprint document on the agri-sector, Food Harvest 2020, will entail considerable investment.

For example, it is estimated that the dairy industry alone will need about €1.5 billion in investment at farm level if it is to reach its potential.

The IFA argues that delays in receiving loan approval are hampering the sector’s ability to plan for investment.

Ironically, the reported reluctance on the part of banks to lend to farmers is taking place at a time when corporate finance firms, accountancy firms and lawyers are proactively targeting many of the State’s top public and private food companies for business.

With most Irish food companies in growth mode, and enjoying particular success in export markets, most of the State’s top professional services companies have rightly identified them as lucrative clients.

If the Government is serious about delivering on the potential of the agri-food sector, it needs to ensure that the proactive support and financial commitment being shown towards food companies and processors is replicated at producer level.

Quirke's latest bet on casino plan

The latest accounts for the Dublin Pool and Jukebox Co Ltd, the company owned by Richard Quirke and which owns Dr Quirkey’s Good Time Emporium on Dublin’s O’Connell Street, includes a declaration that it is continuing with its casino project in Co Tipperary.

In fact, a renewed application was submitted to North Tipperary County Council earlier this month. Last year An Bord Pleanála granted permission for a proposed €460 million casino resort near Two-Mile Borris, but the Government soon afterwards announced it was to introduce legislation that would block the “casino resort” project.

The legislation will allow more modest-sized casinos, and the renewed planning application from Quirke has the proposed casino located in a grandstand that will form part of new horse- and dog-racing tracks on the development.

The part of the planned hotel which was to be used as a casino will be used as an entertainment/conference facility. The development will also include an equestrian centre and a golf course.

The company accounts state that it is continuing to purchase land for the project and that additional property worth €2.64 million was acquired in the 12 months to the end of June 2011. The company made a pretax profit of €2.7 million during the year.

Quote of the day

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TODAY

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