FBD said on Friday it estimates that gross claims and expenses arising from a landmark Covid-19 business interruption pubs test case ruling earlier this month will amount to €150 million, the Irish Times reported. The figure includes claims that will ultimately be picked up by reinsurance companies that have shared the risk with FBD. Meanwhile, the Dublin-listed insurer increased provisions for its net exposure to pubs claims to €65 million from €30 million that had been set aside last summer. The charge includes €11 million of expected payments to reinsurers to reinstate protection.
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Ireland
Ulster Bank executives confirmed on Tuesday that the bank’s 88-strong branch network in Ireland forms part of discussions with Permanent TSB, which is looking to acquire a large part of the exiting bank’s assets, the Irish Times reported. Sources said on Friday that PTSB is in talks to acquire much of Ulster Bank’s €14 billion mortgage book and up to €700 million of small business loans in a deal that could almost double its assets and potentially require a capital injection from the Government. PTSB is 75 percent State-owned.
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Borrowers with higher debt burdens than the current Central Bank of Ireland’s rules allow are more likely to have sought payment breaks during the current crisis, the Irish Central Bank’s deputy governor Sharon Donnery has said, according to a Irish Times report. This was proof that the regulator’s mortgage lending rules had helped the financial sector “absorb rather than amplify the shock of the pandemic”, she said. The Central Bank’s rules curtail consumers to borrowing within strict loan-to-value (LTV) and loan-to-income (LTI) limits.
Ireland’s government said it’s exploring the creation of a so-called third force in banking, should NatWest Group Plc opt to exit the Irish market, Bloomberg News reported. Irish officials have been war gaming the bank’s exit, with one possibility that state-owned Permanent TSB Group Holdings Plc might acquire some of Ulster’s loans. AIB Group Plc is also in negotiations on buying some of the assets. NatWest is reviewing Ulster Bank, with a decision set to be announced as soon as Friday.
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Ryanair on Wednesday lost its fight against the state aid granted to rivals including Air France and Sweden’s SAS after a top European court said such schemes were not discriminatory amid the COVID-19 pandemic, Reuters reported. The judgment from the Luxembourg-based General Court is the first to deal with aid measures cleared by the European Commission under easier rules aimed at helping European Union governments prop up companies hit by the health crisis. The court said the French and Swedish schemes were in line with the bloc’s rules.
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Ryanair’s fight against state aid for airlines will put loosened EU rules to the test on Wednesday when the bloc’s second-highest court decides on support offered to Air France and SAS, Reuters reported. Under European Commission state aid rules loosened since the start of the pandemic, EU countries have offered more than 3 trillion euros ($3.65 trillion) in aid to companies in various sectors across the 27-member bloc. In its first judgments on those rules, the Luxembourg-based General Court will assess a French scheme allowing airlines to defer certain aeronautical taxes.
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Businesses say they’re barely coping with the current pared-down regime of Brexit checks on goods shipments to Northern Ireland and want to delay fuller checks due to kick in on April 1, Politico reported. Executives from ports, haulage, logistics and customs clearance firms issued their plea on the eve of Thursday’s meeting between European Commission Vice President Maroš Šefčovič and U.K. Cabinet Office Minister Michael Gove in London.
Consumer spending declined last month as households cut back after Christmas and as the Covid lockdown reduced shopping opportunities, the Irish Times reported. Total spending fell 14 per cent year on year, with increased sales of digital content and spending on home-related goods failing to offset big declines in hospitality, travel and clothing. Figures compiled by fintech Revolut show spending in bars was down 94 per cent compared with January 2020, while expenditure in hotels and restaurants fell 86 per cent and 70 per cent respectively.
The Irish government plans to launch a new financial support scheme for businesses that have seen their revenues devastated by Covid-19 lockdown restrictions but don’t qualify for the Covid Restrictions Support Scheme (CRSS), the Irish Times reported. The CRSS is available to businesses that were required to prohibit or considerably restrict customers from accessing their business premises as part of Covid-19 restrictions.
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Aer Lingus has secured €150 million from the State-backed Ireland Strategic Investment Fund’s (Isif) pandemic recovery scheme, the Irish Times reported. The three-year loan will be used to strengthen the airline’s liquidity position as it seeks to deal with the impact of the Covid crisis. Isif, which operates under the umbrella of the National Treasury Management Agency, said the loan was agreed on commercial terms. Rival airline Ryanair has been critical of State supports availed of by competitors across Europe.