Rothschild well-placed for government work

Well done to Rothschild’s for retaining the contract to advise the NTMA and Department of Finance on the banking sector.

A notice published on the government’s procurement website last week said the investment bank had beaten off eight other rivals for the gig.

Rothschild has been an adviser since 2009 and has netted €4.5m in fees from the lucrative contract so far.

Rothschild has usurped Merrill Lynch as the government’s favourite financial advisers. When the banking crisis broke in 2008 it was to Merrill Lynch the Department of Finance turned. The relationship between them goes back more than a decade when the bank advised on what turned out to be the disastrous flotation of Eircom in 1999.

But the special relationship came to an end last year when Rothschild came on board as one of the myriad of advisers taken on to solve the crisis.

With the sale of some semi-state companies likely in the next few years providing an opportunity to generate handsome fees, Rothschild will be hoping it doesn’t fall out of favour with the Department of Finance.

Legal trouble for Cardinal

Wilbur Ross, the American billionaire backing the Cardinal Asset Management bid for EBS building society, has found himself in more trouble in the US related to a mortgage company he owns.

Ross, who says Irish homeowners need some form of debt forgiveness, is now being sued by customers of his American Home Mortgage Servicing who say the company’s policies are forcing them to default on their loans.

The company “routinely and systematically assesses unwarranted fees against consumers, resulting in premature default that often gives rise to unfair and improper foreclosure proceedings,” according to the lawsuit filed in a Dallas court last week by one borrower. The company is already under investigation by prosecutors in Texas and Ohio for alleged violations of consumer protection laws.

With the race to buy EBS narrowed down to the Cardinal consortium and Irish Life & Permanent, the negative publicity about Ross will not improve its chances of landing the society.

Profitable times for ITP

Corporate activity may be down but the Irish Takeover Panel managed to return to profit, according to a copy of its annual report which found its way to us.

In the year to June the panel, which regulates takeovers and mergers between listed companies, made a profit of €165,000, reversing a loss of €124,000.

The panel, whose members are appointed by the Central Bank, the stock exchange and bodies such as the Law Society, is concerned that moves by the European Commission may make its job redundant. It will be up to its new chairman, Denis McDonald, to reverse the EU’s move to end national takeover panels’ roles in M&A activity.