Positives in Finance Bill, says IBF

The Irish Banking Federation (IBF) welcomes the inclusion in today’s Finance Bill of a new regime for the taxation of dividends received by companies here from non-resident companies. IBF views this change as an important step in the direction of making Ireland a more attractive location for holding companies.

To date, Irish companies have been taxable at 25% on dividends received from non-resident companies, with a credit for foreign tax. The reduction to 12.5% under the new regime should help to better attract headquarters and holding company operations to these shores – with consequent add-on value to the wider economy in terms of business activity and employment.

IBF also welcomes amendments to allow for the introduction of e-stamping of instruments for stamp duty purposes.

The detail of all provisions in today’s Bill will need to be closely examined to enable a fuller assessment, including new provisions regarding VAT on property which would likely increase the cost of leasing buildings for businesses that have only partial recovery of VAT.

Note to Journalists

The Irish Banking Federation (IBF) is the leading representative body for the banking and financial services sector in Ireland, representing over 70 member institutions and associates, including licensed domestic and foreign banks and institutions operating in the financial marketplace here. As the representative voice for international banks in Ireland, the Federation of International Banks (FIBI) is affiliated to IBF.

Leading International Bankers Foresee Growth in Ireland’s Financial Sector

Merrill Lynch’s Mike Ryan is new IBF President
Citi’s Tony Golden is new FIBI Chairman
For the first time in the history of Ireland’s financial services sector two of the most senior representative positions are occupied by leading international bankers; and both are optimistic about the prospects for future growth in the sector here. As announced today, Mike Ryan (Chief Executive, Merrill Lynch International Bank Ltd) takes over as President of the Irish Banking Federation (IBF) and Tony Golden (Managing Director, Citi Ireland) takes over as Chairman of the Federation of International Banks in Ireland (FIBI), which is affiliated to IBF.

The development is seen as reflecting the global nature of Ireland’s financial services sector today. Since the launch of the International Financial Services Centre in 1987, Ireland has succeeded in attracting many of the world’s leading financial services companies, while at the same time growing its retail banking operations. Today, the volume of business conducted is reflected in assets in excess of €1.2 trillion (a three-fold increase in just five years), direct employment at some 60,000 (a near 7% increase in the last year alone) and the sector overall accounting for 7% of GNP (a doubling in less than ten years).

According to the new IBF President, Mike Ryan, another key measure of the success of the financial services sector will be the extent to which it helps to drive Ireland’s export performance.

“While the contribution of merchandise exports to our economic growth may be declining, services exports have been increasing to a level where they represent 39% of all exports (2006). Crucially, financial services are at the heart of this trend and already account for one-third of all services exports. Other countries in the EU and beyond have also identified financial services as an engine of future economic growth. As Ireland transitions to an economic development model in which traded services become ever more important, it is vital that we maintain and further build competitive advantage through appropriate fiscal and regulatory policies, through increased emphasis on innovation in new products, services and processes and through renewed focus on future skills needs. As IBF President, I believe that further success can be delivered on these fronts and I am firmly committed to working with Government and other stakeholders to that end.”

The sector’s future skill needs will be very much top of the agenda for the new Chairman of FIBI, Tony Golden. In welcoming the recent publication of the report of the Government’s Expert Group on Future Skills Needs, he firmly believes in the potential for ongoing employment growth.

“We need to ensure that Ireland continues to provide the skill sets required by the financial services sector if we are to further enhance our reputation and growth prospects. Employment here in international financial services (banking, funds and insurance) already stands at an impressive 22,000. The report forecasts that we can grow this by 10,000 to some 32,000 by 2012. We look forward to clear and prompt action by all relevant parties on the report’s recommendations on increasing the supply of graduates appropriate to the sector’s needs, on expanding the pool of available labour through new recruitment and training and on collaboration between industry and academia to enhance the content and availability of relevant courses. In this regard, the IBF is already centrally contributing to a new website, CareersPortal.ie, which will be of value to all interested in pursuing a career in financial services here.”

Note to Journalists: Mike Ryan takes over as IBF President from Richie Boucher, Chief Executive, Retail Financial Services (ROI), Bank of Ireland. Tony Golden takes over as FIBI Chairman from Michael Deeny, Managing Director, Depfa ACS Bank. The Irish Banking Federation (IBF) is the leading representative body for the banking and financial services sector in Ireland, representing over 70 member institutions and associates, including licensed domestic and foreign banks and institutions operating in the financial marketplace here. As the representative voice for international banks in Ireland, the Federation of International Banks (FIBI) is affiliated to IBF.

Further Information: Felix O’Regan, Head of PR and Public Affairs, IBF, tel. 6715311, 087 6481644