02 Oct 2018
Bankinter rules out entry into Irish mortgage market
Spanish lender Bankinter has ruled out an entry into the Irish residential mortgage market in the short term, after speculation about their intentions in recent days following its acquisition of Irish-focused credit card provider AvantCard.
Bankinter has said its immediate focus will be on expanding its presence in the Irish consumer credit market, an area it similarly has a focus on in Spain. Bankinter had been speculated as a potential partner for An Post’s (the state owned post office) proposed entry into the Irish mortgage market next year (details and partner lender still TBC). Meanwhile, non-bank lender Finance Ireland has said it plans to enter the Irish mortgage market next year and will release its plans for this in December, while the Irish credit union sector has also said that it plans to expand its so far minimal presence in the mortgage market now that it has created a standardised product with centralised underwriting and credit support now available to individual credit unions.
Irish Economy: NTMA announces auction schedule for Q4
The NTMA has outlined its issuance plans for Q418. Subject to market conditions, the agency will conduct one bond auction on Thursday 8 November, a T-bill sale on Thursday 13 December and a syndicated sale of a new Irish Sovereign Green Bond during the quarter. The NTMA has raised €13.5bn from the sale of benchmark bonds since the start of the year, close to the bottom end of its 2018 target funding range of €14-18bn.
Conservative party conference
Tory party conference continues in Birmingham today. Yesterday we heard Chancellor Hammond pressing for Eurosceptic support with talk of a Brexit ‘deal dividend’ of lower taxes and higher public spending whilst a statement from PM May last night reiterated plans to focus on high-skilled migrants after Brexit, without preferential status for EU citizens, albeit perhaps with this line softening as negotiations with Brussels progress. From around 1.30pm onwards yesterday, the pound received support from reports from Bloomberg that the UK was planning a compromise offer to move forward the stalemate on the Northern Ireland border issue in talks with Brussels. Today, Boris Johnson is expected to accuse PM May of ‘apeing’ Jeremy Corbyn as he strengthens his criticism of May ahead of her concluding speech tomorrow. Indeed, the PM’s ‘Campaign 2022’ session tomorrow spans 10am -12pm tomorrow.
May NI/RoI Brexit border proposal
Yesterday afternoon, Bloomberg released a story which reported that British Prime Minister Theresa May is set to make an offer on the Irish border to move Brexit talks forward later this month. The proposal that is being talked about involves a different treatment of tariff checks and regulatory checks. In addition, Northern Ireland would need to remain aligned with the rest of the EU's rulebook (and therefore RoI) on regulations. But it is proposed that there would be no difference between NI and the rest of the UK on tariff checks and no customs border down the Irish sea, for example. Sterling has jumped on the reports, seen as making a deal more likely, with EURGBP trading below 89p once again following the news release. The Irish border issue is likely to major talking point at the Tory party conference, which continues today (see Thought of the Day below).
UK manufacturing PMI
The UK manufacturing PMI rose from (a revised) 53.0 to 53.8 in September, beating consensus and Investec expectations for a fall to 52.5. According to the PMI, output picked up to a four-month high, which respondents attributed to a combination of new business, stock building and efforts to clear order backlogs. On the demand front, manufacturers saw a solid increase in new orders, principally as exports eked out a modest recovery after having seen a “solid” contraction in August. Elsewhere, Bank of England figures showed that the number of mortgages approved for house purchases had firmed to a better-than-expected 66.4k in August (consensus 64.5k, Investec 64.6k), with July’s outturn revised up to 65.2k. Net mortgage lending was more disappointing at £2.9bn (consensus £3.5bn, Investec £3.6bn), a slight fall from the (revised) £3.0bn registered in July.
UK 09.30 Construction PMI
UK 09.45 BoE’s Chief Economist Andrew Haldane speaks in London
UK 09.45 BoE’s Chief Economist Jonathan Haskel speaks in London
EU 10.00 PPI August