In short

More business news in brief.

Fed holds US interest rates steady

The US Federal Reserve held interest rates steady yesterday, expressing concerns on both economic growth and inflation and offering few clues as to when it might push borrowing costs higher.

The 10-1 decision by the US central bank leaves the benchmark federal funds rate target at a low 2 per cent, where it has been since April.

The Fed had reduced rates by a cumulative 3.25 percentage points since mid-September in response to a sharp housing retrenchment and turmoil in credit markets. "Although downside risks to growth remain, the upside risks to inflation are also of significant concern," it said.

The announcement mirrored a statement issued after the last meeting in late June, but it omitted a phrase contained in the June statement that had said risks to growth appeared "to have diminished somewhat". - (Reuters)

Credit union code proposal criticised

Credit union groups and financial industry bodies have criticised the financial regulator's proposed consumer protection code for the State's 420 credit unions, saying its voluntary nature and "one-size-fits-all" approach will not improve regulation of the sector.

The regulator has just published submissions it received on the code.

The Credit Union Development Association said its unions had "serious philosophical and operational difficulties with the current proposed code". It said "a statutory savings protection or guarantee arrangement" was an urgent requirement to protect financial consumers.

Providence drilling off south coast

Providence Resources has begun exploratory drilling of two potential oil wells off the south coast.

The Dublin and London-listed company said it began drilling an appraisal well at Hook Head at noon yesterday.

When this is finished, it intends to begin work on the Dunmore oil accumulation, 32km (20 miles) to the north.

It expects the operations to last three months.

Finavera closer to windfarm deal

Canadian-based energy company Finavera says it has taken the first step in signing up an investment partner for a €250 million Irish windfarm project.

The firm said yesterday it had signed a letter of intent with an unnamed investor for its Cloosh Valley windfarm in Co Galway. The project is listed for inclusion in the energy regulator's next licensing round for wind-generated electricity.

Finavera said it expected to be offered a licence in October next year.

Société Générale profit down 63%

Investment banking losses pummelled Société Générale's second-quarter profits, although the French bank's bruised shares rose almost 10 per cent yesterday since many had feared worse results.

France's second-biggest listed bank, victim to the world's worst rogue trader scandal earlier this year, said net profit fell 63 per cent to €644 million. Gross operating profit fell 42 per cent to €1.627 billion.

In January, the bank unveiled €4.9 billion of losses it said were caused by unauthorised deals carried out by Jérôme Kerviel. - (Reuters)

Swiss Re buys Barclays unit

Swiss Re, the world's largest reinsurer, agreed to buy Barclays' life assurance portfolio for £753 million (€953 million) in cash, even as it wrote down more credit assets.

Swiss Re said it would acquire about 760,000 life insurance and pension policies and annuity contracts, for which Barclays had stopped writing new business since 2001, representing £6.8 billion in invested assets. - (Reuters)