Dublin: Bank of Ireland said it was attracting deposits, cutting costs and expected home loan arrears to peak this year, raising hopes Ireland’s biggest lender had turned a corner after a 60 per cent drop in underlying profit in 2011.

The only Irish bank to avoid nationalisation after an unprecedented property crash, the bank said yesterday low interest rates would make it harder to achieve its goal for a net interest margin — the gap between what it charges for loans and what it pays to borrow — of 2 per cent in 2014.

But Chief Executive Richie Boucher was optimistic of progress after the cost of drawing in deposits and an expensive government guarantee of its liabilities trimmed the margin by 13 percentage points to 1.33 per cent in 2011 ref.

Cost base

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Recent data out of China has increased concerns the government may not move to loosen monetarily policy, thereby limiting its ability to simulate growth. Given that China is such a large source of demand throughout the world, any hint that Beijing may experience a hard landing has major implications for economic markets.

By chris Tedder, Research Analyst Forex.com

Inflation data started the rumours about the PBoC, with January’s rise of 4.5%y/y in consumer prices representing the first time the headline figure has increased over the previous month since July last year, when inflation was around 6.5%y/y. If this figure does deter policymakers from further loosening, it could limit Chinese growth prospects and in turn increase the chance of a hard landing for the world’s second largest economy.

However, we do suspect that these figures have caused Beijing to reconsider its position. Firstly, the Chinese lunar New Year has historically caused volatility in the following month’s CPI data and on most occasions led to temporary spike. Thus, once we take out the holiday impact out of equation, inflation may still be declining. But the market will have to wait until February’s figure for confirmation that CPI inflation is resuming its moderating trend. Nevertheless, we are predicting the headline figure to fall to 3.5-4% after the effects of the New Year have eroded.

The same distortion can be seen in recent trade figures out of China. China’s trade surplus increased to $27.3bn in January, led by a massive decline in imports of 15.3%y/y. Whilst some of the decline in imports can be attributed to scores of manufactures shutting down production during the New Year holiday, it is the second month of consecutive declines. This paints a worrying picture of the domestic demand situation in China and may point to harder slowdown than economists predicted.

Furthermore, Chinese exporters have been hit hard by weak levels of demand from its largest trading partner, Europe. Export growth has been on a gradual decline since September last year, representing a slump from +24.5 to -0.5. Given the predicted levels of growth in Europe over next few years China’s export sector may continue to suffer and accordingly China may have to find demand in other markets. Yet, right there is no viable alternative that can fully account for the pre-European financial crisis levels of growth.

What does this mean for monetary policy? We maintain our view that the PBoC will have a relatively prudent stance involving selective easing. The PBoC’s reluctance to cut the required reserve ratio (RRR), combined with improving global conditions and domestic growth that is moderating within targeted levels, support over view of discerning policy loosening. Nevertheless, we are still predicting RRR cuts and more growth stabilising measures by Beijing to help control the descent in the country’s GDP growth and in turn avoid a hard landing.

Overall, Beijing still has a lot of room to move in regards to policy and stimulating growth, thus we expect that China will avoid a hard landing. However, a continued slowdown in China will have impacts for commodity demand and corresponding raw material based economies. Furthermore, overall risk sentiment should remain fairly jittery to news stemming from the second largest economy in the world.

Rome: Italian anti-mafia prosecutors said they seized a record $6 trillion (Dh22 trillion) of allegedly fake US Treasury bonds, an amount that’s almost half of the US’s public debt.

The bonds were found hidden in makeshift compartments of three safety deposit boxes in Zurich, the prosecutors from the southern city of Potenza said in an emailed statement. The Italian authorities arrested eight people in connection with the probe, dubbed "Operation Vulcanica," the prosecutors said.

The US embassy in Rome has examined the securities dated 1934, which had a nominal value of $1 billion apiece, they said in the statement. Officials for the embassy didn’t have an immediate comment.

The financial fraud uncovered by the Italian prosecutors in Potenza includes two cheques issued through HSBC Holdings Plc in London for £205,000, cheques that weren’t backed by available funds, the prosecutors said. As part of the probe, fake bonds for $2 billion were also seized in Rome. The individuals involved were planning to buy plutonium from Nigerian sources, according to phone conversations monitored by the police.

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Huge growth potential seen in Saudi Arabia’s newly liberalised market.

Saudi Arabia’s newly liberalised insurance market comes under the spotlight this week with estimates that a market currently worth around $1.5 billion annually could soar to $8 billion within 10 years.

An elite speaker faculty of key international and regional professionals will be taking part in the 2nd Saudi Insurance Summit at the Jeddah Hilton Hotel 29-30 October 2007. The Summit, taking place with the approval of the Governor of Jeddah Prince Mishaal bin Majed bin Abdulaziz, is expected to be attended by more than 300 insurance professionals, regulators and key industry players.

The Saudi Arabian Monetary Agency recently reported the insurance market grew 35% in 2006 alone. Gross premiums rose to $1.8 billion from $1.3 billion in 2005. General insurance premiums, which represented 65% of the insurance market, increased by 25% to $1.2 billion in 2006 compared with $959 million in the previous year.

Protection and savings insurance premiums, which represented a mere 3% of the insurance market, went up by almost 16% to $59 million in 2006 compared with $51 million in 2005.

But it is health insurance that is attracting the most attention – representing 32% of the insurance market – and saw premiums increased by 57% to $589 million in 2006 compared with $375 million in 2005. This growth is mainly driven by the decision to make health insurance mandatory for all expatriate workers as well as favourable economic conditions.

New laws require the kingdom’s seven million expatriates to prove that health insurance cover is provided to them by their employers. The first phase demanded compliance from companies with over 500 employees by July this year. Remaining companies have until March 2008 to ensure their workers are covered.

The opening up of Saudi Arabia’s insurance sectors has injected hundreds of millions of dollars into the market with more to come through new company licensing and public offerings.

All insurance companies operating in the Saudi market must obtain a license by March 2008 or cease operations. The capital requirements for gaining a license are $26.67 million for insurers and $53.33 million for reinsurers with an additional 10% statutory deposit. Companies are also obliged to float at least 25% of their shares on the Tadawul and meet other regulatory requirements before receiving a licence.

At present, 18 companies have been licensed, with 24 more expecting to be granted approval.

“The new laws have led many in the industry to forecast excellent growth in the non-life sector in Saudi Arabia with predictions of $4 billion growth by 2009 being touted,” said Deep Marwaha, Senior Conference Manager, of IIR Middle East, organisers of the 2nd Saudi Insurance Summit

“Within this high growth market, the landscape is shifting dramatically,” said Marwaha. “The 2nd Saudi Insurance Summit aims to ensure that key players keep abreast of new developments in what is a breakneck business environment.”

In addition to the two-day Summit, there are two practical workshops. The first is on the principles of Islamic insurance – Takaful structures and Shari’ah compliance, conducted by Rodney Wilson, Director of Postgraduate Studies and Professor of Economics at the University of Durham’s School of Government and International Affairs, UK.

A post Summit workshop – Mind the Gap! How Can We Bridge the Insurance Skill Shortage? – will be led by Ian Wilson, Head of Insurance Programmes at the Institute of Banking, Saudi Arabian Monetary Agency.

Among more than 30 leading international and regional speakers taking part in the Summit will be Dr Muhammad Al Jasser, Vice Governor of the Saudi Arabian Monetary Agency; Ali Al Subaihin, CEO of the Company for Co-operative Insurance (NCCI); Brad Bourland, Chief Economist of Jadwa Investment Company, Saudi Arabia; Tal Hisham Nazer, Managing Director BUPA Middle East; and Dawood Taylor, Group Head, Takaful Ta’awuni, Bank Aljazira, Saudi Arabia.

NCCI are diamond sponsors of the Summit; Medgulf and Bank Aljazira are platinum sponsors; Takaful Re is a gold sponsor; and Salama Co-operative Insurance Company and HiQSys Saudi are silver sponsors.

<span class="articleLocation”>(Reuters) – If you were burned by emerging market stocks last year, you might want to give the relationship another chance in 2012. The stocks are doing pretty well so far this year, and analysts point to multiple reasons the gains should continue.

During the first four weeks of the year, Vanguard’s MSCI Emerging Markets, the largest emerging market stock index ETF, was up nearly 11.6 percent – more than double the 5 percent return for the SPDR S&P 500.

The upswing indicates to investing experts that a drop of almost 20 percent in emerging market stocks last year wasn’t a bubble bursting.

“After burning investors last year, we expect the BRIC countries to be among the top-performing markets in 2012,” said Ned Davis Research analyst Anthony Welch of the four dominant emerging markets: Brazil, Russia, India and China. “We think this is a good time to add to exposure to those markets.”

The stocks and the funds that invest in them are still vulnerable to many of the same shocks that rumbled through the markets in 2011; but analysts say a combination of positive economic trends, comparatively strong growth, and down-to-earth prices make the recent upswing not just a recovery bounce, but an opportunity.

To support his optimistic outlook, Welch, in a January client report, pointed to a demonstrated ability of those countries to manage the delicate balance between controlling inflation and maintaining economic growth. He also pointed to signs of stabilization among global economies.

‘GOOD SHOT’ AT OUTPERFORMING U.S. STOCKS

Another draw for investors: stock prices are trading at a discount compared to historical levels even after the recent rally, said David Semple, Director of International Equity at Van Eck Global.

According to Semple’s estimates, the group is selling at less than 10 times forward earnings, compared to their historical range of 12 to 13 times earnings.

“That’s not as cheap as the post-crisis periods of late 2008 and early 2009, but it’s quite attractive,” he said.

But he also cautioned that a worsening of the European debt crisis or other developments could throw at least a temporary wrench into the picture.

“Emerging market stocks have a good shot at outperforming U.S. stocks this year, but that could easily change if the Europe situation turns into an ugly mess. And other potential problems — such as an unanticipated slowdown in developed market growth, too much credit restriction in China, and even weather-related issues that could impact food prices — are still there,” he said.

Investors are also keeping an eye on slower economic growth in the more mature emerging market countries, especially China. This year, the World Bank expects gross domestic product growth in that country to come in at 8.4 percent compared to 9.2 percent last year and 10.3 percent in 2010.

Still, GDP growth in emerging market countries is likely to continue to outpace expansion in the United States and Europe by a healthy margin, according to the most recent projections from the Conference Board, a New York-based business and economics research group funded by major corporations.

The Conference Board said it expects growth in developed economies to slow down from 1.6 percent in 2011 to 1.3 percent in 2012 while emerging market growth will decelerate from 6.4 percent in 2011 to 5.1 percent this year.

EMERGING MARKET ECONOMIES

The positive impact that comparatively robust emerging market economies could have on those countries’ stocks is the main reason Weyman Gong, chief investment strategist at Signature Financial Management in Norfolk, Va., allocates as much as 20 percent of his clients’ stock portfolios to exchange-traded funds (ETFs) and mutual funds that focus on

those regions.

For broad exposure to emerging markets he uses two ETFs, Vanguard MSCI Emerging Markets and iShares MSCI Emerging Markets. As of Friday, they were up 11.57 percent and 11.65 percent, respectively, so far this year.

“In the U.S. and Europe, consumers are so highly leveraged that they have to use money to pay off debt rather than spend,” said Gong, whose firm manages some $2 billion in assets for high-net-worth individuals and families. “Emerging market households aren’t nearly as consumed by debt, so they have more money to feed the growth engine.”

Even with the group’s notoriously sharp downturns and snap-backs, Gong believes that retirees should have an allocation toward emerging market stocks in the low teens.

“Treasury bonds may seem safe, but at current yields they provide no protection from inflation,” he said. “Putting money under the mattress won’t protect you 20 or 30 years down the road.”

Mark Martiak, vice president at Premiere Financial Advisors in New York, New York, typically invests between 10 percent

and 20 percent of his clients’ equity portfolios

in emerging market securities. Because they don’t perform in sync with other asset classes such as U.S. stocks and bonds, he sees them as a good way to diversify.

“Emerging markets will remain the fuel for world growth, and secular themes such as population growth and an emerging middle class are truly powerful drivers,” he said. “But I always warn my clients that the short-term headline risk with these securities is very real.”

(Reporting By Marla Brill; Editing by Beth Gladstone, Chelsea Emery and Andrea Evans)

Story By: by Eyder Peralta

A man with an Apple iPad in 2010.

Chinese authorities are pulling iPads from store shelves after a Chinese company complained that it owns the name “iPad.” According to The Wall Street Journal, the action comes after Proview (Shenzhen), a Chinese affiliate of Hong Kong manufacturer Proview International Holdings Ltd., filed for an injunction against Apple.

The Journal adds that Proview (Shenzhen) registered the name “iPad” in 2001. The paper adds:

“It’s not clear whether the Shijiazhuang case heralds a wider crackdown on iPads in China, where Apple devices generate enough demand to spark the occasional violence in front of the Californian company’s official retail stores. Proview has registered a complaint against Apple with the Beijing branch of the AIC, according to the state-run Xinhua news agency, though so far the Beijing AIC appears not to have taken action.

“In any case, the revelation that authorities in Shijiazhuang had begun confiscating iPads did not appear go over well with Apple fans on popular Twitter-like microblogging site Sina Weibo, where the news was greeted with more than a few animated thumbs-down icons.”

Mashable reports that Proview and Apple had actually come to agreement in 2010. Apple bought rights from Proview, “but rights have not extended to China.”

The Los Angeles Times reports that Proview has been taking action on a city-by-city basis.

“You’ll likely see more and more actions across the country,” Xie Xianghui, a lawyer for Proview Technology, told the Times. “Apple did not follow Chinese law, so we’re confident the authorities will side with us.”

Reuters reports that aside from filing for injunctions, Proview is also seeking $1.5 billion in compensation from Apple, because it says it has infringed on its copyright.

<span class="articleLocation”>(Reuters) – Why should you pay to spend your own money? The newest generation of prepaid debit cards, which banks keep offering despite the growing chorus of advice to the unbanked against buying into them, often levy more fees than conventional credit cards. The latest indignities even include charges for adding money to your account.

There are myriad reasons people choose a prepaid debit card,

but they are all predicated on the hypothetical equation that the cards will save them money over traditional checking accounts with potential overdraft fees. Yet, with these cards, you don’t build a credit history to increase your credit score; you don’t avoid fees; and, you don’t structure your finances so that you spend more wisely.

The only real beneficiaries of these cards are the institutions that issue them, because the fees add up with the same regularity as with bank accounts, and sometimes amount to more charges for the users than there would be with a traditional checking account.

Take the new Mango card, for example. While it gives you a paltry $20 one-time bonus for enrolling in direct deposit — far less than what the issuing bank will save over time — it charges you $2 per ATM withdrawal, $4.95 to deposit cash through a third party (direct deposit is free) and 50 cents for each balance inquiry.

To its credit, the Mango card is linked to your savings account and will reimburse the $5 monthly fee if you add at least $500 a month, which is a virtual wash when you consider the reload fee. And there’s a big catch on the promised 6 percent yield on the savings feature: It’s only for balances less than $5,000 and it’s a teaser rate, so it won’t last long. Have more than $5,000 on deposit? Then the rate is 0.10 percent.

Unlike the new fee-laden Approved Card, which has TV personality Suze Orman as a promoter and investor (link.reuters.com/jex56s),

the Mango card is being endorsed — but not co-branded by — comedian George Lopez. While Lopez may be a funny guy, the card and its fees are no laughing matter if you’re serious about saving money.

Celebrity cards are rarely a good deal. In most cases, you’ll pay more, so instead of running toward celebrities’ financial products, we should be bolting away from them. Which brings to mind Russell Simmons’s pre-paid Rush Card, also marketed under “Baby Phat,” which advertises no “hidden fees.”

The music mogul has promoted the card as a way to empower the black community with access to banking services. While the card doesn’t hide its fees — they are listed in the cardholder agreement (link.reuters.com/sex56s) — they certainly add up and don’t encourage net savings. The company will impose surcharges up to $14.95 just based on the design or logo on the card. You are allowed two free withdrawals per month, but after that the cost is $2.50 per transaction. There’s no charge to add money, but if you need to replace your card or get express cash, it’s $30 for each service. The basic plan costs $9.95 a month.

The obvious drawback to consumers of paying multiple fees for access to their money on these products came to the attention of the Florida Attorney General’s office, which last year was investigating the claims of the Rushcard and other prepaid card companies. Perhaps more state attorneys general should start looking into bank practices on these prepaid cards to see if there is any predatory marketing going on; and work on regulating the message banks are sending. Maybe a consumer campaign on Twitter would be enough to put a stop to them.

Simmons, for his part, responded to the Florida probe by defending his product, saying: “third party research has shown that for many customers, the best prepaid card services offer significant savings compared to what they would pay in traditional bank checking accounts, with savings of up to 50 percent.” (link.reuters.com/kex56s)

If there were no free checking accounts or debit cards available, that might be true. But we recently listed 10 options (link.reuters.com/wep95s), and you can go to a site like bankrate.com (link.reuters.com/mex56s) and find plenty more. Some 76 percent of credit unions (link.reuters.com/nex56s) offer free non-interest bearing checking accounts. You can still get socked with overdraft fees, though, so you have to be careful how you use them. You can also do a detailed calculation comparing bank fees and prepaid debit cards fees at the credit card-comparison site nerdwallet.com (link.reuters.com/pex56s).

Want to stick with banks? Then check out online banks. More than half of them offer free checking accounts with no maintenance fees, according to Moneyrates.com (link.reuters.com/qex56s),

which notes that “free checking is making a comeback.”

If you really want to endorse what a celebrity is doing, just watch their shows or buy their books or music. Stay away from their financial services offerings. They are not only banking on their fame, they are overcharging you to subsidize their celebrity.

(Editing by Beth Pinsker Gladstone and Andrea Evans)