Category: Archive

The Ticker: AIB pension fund takes big hit

February 16, 2011

By Staff Reporter

The collapse reflects a 24 percent fall in the Group Managed Pension Funds of AIB Investment Managers, which manages AIB’s staff program. The assets in the AIB defined benefit schemes at the beginning of last year amounted to euro 2.9 billion, leaving a surplus of euro 257 million in the fund to meet future payment obligations to AIB pensioners.
But the 24 percent fall in the value of assets under management during the year — amounting to nearly euro 700 million — leaves the funds in deficit by at least euro 300 million. AIB may be forced to dip into its 2002 profits to the extent of hundreds of millions of euro to put the funds back in surplus.
It is a big setback for AIB at a time when it had been recovering strongly from the Allfirst fiasco.
A recent survey by Bloomberg showed that the bank has delivered returns to its shareholders over the last two years, in the form of share price appreciation and dividends, that are at the top of the international banking league tables.
A source close to the bank has speculated that AIB will use euro 300 million of shareholders’ one-off windfall profits from the merger of Allfirst with MT&T to top up the staff pension fund and put it back into surplus. But in the long-term, the underperformance of AIB Investment Managers is a major issue for the bank and AIBIM clients.

Air passengers who have flights delayed or cancelled can claim compensation of up to euro 600 under laws being drawn up by the EU, the Irish Examiner reported Monday.
Under the regulations, which will be introduced later this year, on-the-spot compensation will be almost doubled. Passengers will also have a legal right to food and accommodation, or a substitute flight.
Current levels of compensation, set in 1991, include euro 150 for short flights and euro 300 for distances up to 3,500 kilometers However, from this year passengers can claim euro 600 for flights of more than 3,500 kilometers, euro 400 for flights of 1,500-3,500, and euro 250 for short flights.
The compensation guidelines are aimed at introducing common standards of compensation for all passengers affected by overbooked or cancelled flights.
However, low-fare airlines have warned ticket prices will soar because of the new laws.
Ryanair, together with a coalition of four other low-fare airlines, is arguing that the laws are unfair and will hit budget carriers much more heavily than traditional airlines. They claim the laws will cost the airlines almost euro 55m a year in compensation, more than three times the value of the actual cancelled tickets.
In a strongly worded lobbying document, the low fare airlines industry said the laws will be anti-competitive and unfair and lead to increased fares. They claim the vast majority of flights are delayed by factors outside its control such as airport problems and said as little as 9 percent of flights are cancelled by the airlines themselves for commercial reasons.
Aer Lingus has broadly welcomed the new levels of compensation. The Oireachtas committee on European Affairs, chaired by Fine Gael TD Gay Mitchell, has decided to pass on the legislation for further scrutiny to the committee with responsibility for transport.

Pfizer Inc., the world’s largest pharmaceutical company, is to establish its European Financial Shared Services Center in Dublin, with the support of IDA Ireland.
“This investment is reflective of Pfizer’s positive experiences in Ireland and its strong commitment to this country, Tainaiste Mary Harney said last week. “It is expected to create approximately 200 new jobs by the end of 2005 for people with qualifications in finance, accounting, IT and with multi-language skills.” Pfizer’s new center will process financial activities for the company’s European operations in areas such as purchase payments, travel, transactional tax and treasury and general accounting. It will function distinctly from the company’s treasury center and banking activities, which operate from the International Financial Services Center in Dublin.
Helmut Kasztner, director of the center, praised the location. “We conducted extensive research to identify the best location for this crucial business function,” he said. “Ireland faced strong competition for this project but Dublin was chosen mainly because of its access to a broad base of skilled resources.”
Pfizer already has a significant presence in Ireland, ranging from the production of bulk active ingredients and finished pharmaceutical products, through the sale and marketing of these products, to the treasury and banking operations conducted in the IFSC. The company currently has 1,600 people working in the company’s facilities in Cork and Dublin.
New York-based Pfizer discovers, develops, manufactures and market-leading prescription medicines for humans and animals and many of the world’s best-known consumer brands. It employs 90,000 people worldwide.

Ireland’s dairy industry has again lobbied the European Commission to achieve improved milk returns for this year.
A delegation from ICOS, the Irish Dairy Board and the IFA met with the commission director of livestock products and senior milk division officials in Brussels last week, the Sunday Business Post newspaper said.
The meeting was a followup to discussions in November between EU Farm Commissioner Franz Fischler, Minister Joe Walsh and Irish dairy industry representatives.
Last week’s meeting focused on Irish dairy industry proposals, which it says will allow EU milk product prices to rise at least 5 percent above the intervention level.
According to ICOS, the umbrella body for the country’s co-ops, there was a constructive and detailed discussion on the current market situation, export market demand and the need to ensure EU exports remain competitive.

The Newport County, R.I., Convention and Visitor’s Bureau is once again offering its Newport Winter Getaway Package in honor of Irish Heritage Month. A special Irish Connection getaway package features two $25 dining vouchers redeemable March 1-30 at the following Kinsale, Ireland Festival of Fine Food restaurants: Sardella’s, La Forge Casino, Windward Grille at The Newport Hyatt, The Black Pearl, 22 Bowen’s Wine Bar & Grille, The Clarke Cooke House, and Fathoms at the Newport Marriott.
Also included in the Irish Connection package are all the features of the classic Winter Getaway Package. Lodging for one or two nights with complimentary breakfast for two at participating properties, admission vouchers to area attractions including wineries, mansions, museums, and an outdoor skating rink, discounts at local shops and boutiques, and souvenir gifts of Irish cr

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