Ireland

Nama plans to launch a product for purchasers of residential properties in the autumn that will offer protection against the risk of negative equity in the future, the agency’s chairman, Frank Daly, said, the Irish Times reported. It is hoped that the initiative will help stimulate activity in the market. Mr Daly said Nama has identified concerns among debtors that house prices could continue to fall after they purchase a property as one of the “key impediments” to the sale of houses and apartments.

P Elliott, one of the largest construction companies in the State, has entered receivership with debts of more than half a billion euro, the Irish Times reported. Kieran Wallace and Cormac O’Connor of KPMG were appointed as receivers yesterday afternoon to P Elliott Company and a related company, Dewside Limited. While the receivers were appointed at the instigation of the directors of the company, they will work to retrieve money on behalf of Ulster Bank.

The wife and five children of businessman Seán Quinn have lodged a High Court action seeking massive damages against Anglo Irish Bank over alleged negligence, breach of duty and intentional and/or negligent infliction of economic damage, the Irish Times reported. The damages claim arises from events of the past two years that led to the family losing control of the Quinn group of businesses and is believed to seek hundreds of million of euros.

Irish Life and Permanent today announced its residential mortgage arrears continue to increase while demand for new mortgages "has been very subdued" so far this year, the Irish Times reported. The company had €13.1 billion of drawings from the European Central Bank at the end of April, down from €13.8 billion at end-December.

The IMF stuck to business on Monday despite the sexual assault arrest of managing director Dominique Strauss-Kahn, approving €1.58 billion ($NZ 2.8 billion) in new assistance to debt-laden Ireland, The New Zealand Herald reported. The International Monetary Fund said it had completed its latest review of the country's progress under the €85-billion European Union bailout package for the country, and was ready to release the newest tranche of its rescue loan.

Shareholders in Irish Life & Permanent meet on Wednesday for what is more than likely the last ever annual general meeting of the company in its current form, the Irish Times reported. Under the Government’s plans for the banking sector, IL&P will have disposed of or floated its life assurance business by this time next year. The remaining banking business, Permanent TSB, will have received a dollop of taxpayers’ money – about €4 billion – and will in effect be nationalised if it has not been merged or sold.

Changes in the bankruptcy laws to help people in difficulty with their mortgages will be published as soon as possible, the Department of Justice said last week, the Irish Times reported. A spokeswoman for the department said interim measures to reform the law on bankruptcy were being drafted with a view to publication this year. “The Bankruptcy Act 1988, as it stands, does not meet the needs of modern social and economic conditions,” said the spokeswoman.

Tánaiste Eamon Gilmore has pledged Ireland will not restructure its debts, the Irish Times reported. He made the comments at a conference in Oslo today. The Government is "confident" it will be able to reduce its deficit under the current economic programme, he said. In an Irish Times article last week, economist Prof Morgan Kelly said the country was on track to owe a quarter of a trillion euro by 2014, and said a prolonged and chaotic national bankruptcy was becoming "inevitable".

Bank of Ireland has a "good chance" of avoiding State control by offering junior bondholders an opportunity to convert to equity, according to Harris Associates LP, its largest institutional investor, the Irish Times reported. Investors would prefer to see junior bondholders swap debt for equity to help the lender reach its capital target than the government increasing its 36 per cent stake to a majority holding, Robert Taylor, director of international research and portfolio manager with Chicago-based Harris Associates, said in a telephone interview.

The European Central Bank should provide Ireland with an interest-free loan of €40-50 billion to “overcapitalise” the Irish banks, according to a report issued by the Economic and Social Research Institute (ESRI), the Irish Times reported. In its latest quarterly economic commentary, ESRI authors Joe Durkan and Cormac O’Sullivan say there must be “an acceptance that this is an EU problem and requires EU solutions”.