Nyon, Switzerland (GenevaLunch) - Half of the debt owed by European football clubs is owed by British clubs, the Nyon-based European football association Uefa is expected to say in an upcoming report, The European Club Footballing Landscape. A copy of the report has been seen by the Guardian, the newspaper writes in a lengthy article that looks at football club budgets. It says that “When it publishes the report in the coming weeks, Uefa will present it as authoritative evidence of the need for its Financial Fair Play rules, agreed in principle by the major clubs and leagues, which will require clubs to break even financially from 2012-13.”
Tax revenues were down by €7.7 billion, or 19 percent, in Ireland for 2009, Department of Finance figures published Tuesday 5 January show. The drop in revenue combined with a €4b government bailout of Anglo Irish Bank pushed the national debit €11.9 billion higher.
Ireland’s high debt and the problems of Iceland, still trying to recover from the collapse of its economy a year ago, are likely to add to Eurozone woes in 2010, argues Ralph Atkins in the Financial Times.
Links to other sites: Financial Times, Irish Times
Spanish air carrier Iberia and British company British Air (BA) have ended 16 months of negotiations with an agreement to merge as equal partners, but the deal is far from done. The new company would be tax resident in Spain, but the head office would be in Britain. BA’s pension plan debt of £2.66 billion, exactly equal to the value of the company, must be brought under control or Iberia could still back out of the deal, according to the terms of the agreement. Iberia Friday morning 13 November posted a nine-month pre-tax and interest operating loss of €331 million, higher than analysts expected, for a net loss of €181m during the period. The new airline, which does not yet have a name (TopCo is being used temporarily), would be Europe’s third largest, after Lufthansa and Air France-KLM.
Links to other sites: El Pais (Spa), Financial Times, London Stock Exchange news, Times, UK
The one-third of China’s recent university graduates who are still without jobs are less likely to find themselves offered credit cards, as the impact is starting to be felt of a mid-July government order to banks to more strictly control personal credit. China Citic Bank told China Daily at the end of July that only 30 percent of applications were being approved, less than half the number a few months ago. “In a notice sent to Chinese commercial lenders in mid-July, the China Banking Regulatory Commission, or CBRC, the country’s top banking watchdog, ordered banks to tighten credit card issuance practices and carefully appraise credit ratings before issuing cards to applicants.” The country at the end of June reported a quarterly 133 percent increase in outstanding credit card payments that were more than six months overdue, compared to Q2 in 2008. China is traditionally a cash society with a strong tendency to save, and therefore with little experience of managing personal debt: despite concerns about payment problems China still has only 0.11 credit cards per person, compared to 4.39 in the US and 0.96 in Brazil, according to Xinhua. China Daily, Reuters
Zimbabwe will receive $22 million from the World Bank, the first money from the bank since 2000, but it falls far short of the $8.5 billion economically-strapped Zimbabwe has been seeking. The World Bank calls it a first step, saying it will see how the country deals with debt reduction, reports the BBC. Background, World Bank
Lausanne, Switzerland (GenevaLunch) - Canton Vaud, alarmed by the growing number of citizens whose household budgets are deteriorating badly, is setting up a debt hotline for people drowning in debt.
Two-thirds of British universities are pushing for an increase in annual fees that could raise them by £4,000-20,000. Fee structures are up for government review this year. Students currently pay maximum fees of £3,500 a year. The National Union of Students argues that if fees rise to even £7,000 students will face a debt of £32,000 on graduation. Higher Education Minister David Lammy warns that “There is an important debate to be had now, which is about how we maintain the world class status of our higher education sector.”
The Financial Times reports that “More than half the profits from some of the UK’s biggest recent private equity deals were generated by high levels of debt, while less than a fifth came from operational improvements at the underlying companies,” based on a new report on the performance of private equity portfolio companies that was issued under pressure from the government.
