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In Business news: the central bank will continue with forex interventions until 2015, no more bearer stock certificates after January 1st, Moravia Steel acquires full ownership in Třinecké železárny and the state pays millions to assess the “drinkability” of Czech beer.
Central bank to continue with forex interventions
The Czech central bank has confirmed its intention to continue with forex interventions in the coming year to lower the value of the crown aiming for an exchange rate close to 27 crowns to the euro. The bank board said the interventions were significantly reducing the risk of long-term deflation although they could not entirely prevent a short period of deflation in which falling energy prices are expected to play a significant role. The interventions are expected to accelerate the return of inflation towards the bank’s target and speed up the recovery of the economy.
No more bearer stock certificates
The Czech Industry and Trade Association has warned that it will no longer be possible to issue bearer stock certificates after January 1, 2014. These will become certificated shares in order to increase transparency. Joint stock companies have until the end of March to issue a call for shareholders to present shares for replacement. By the end of June affected companies will have to prepare new statutes and submit them to the collection of documents. They must also change the form of the shares in the business register.
Moravia Steel acquires full ownership of Třinecké železárny
The company Moravia Steel, controlled by billionaire Tomáš Chrenek, has completed the buyout of minority stakes in the biggest Czech steel maker Třinecké železárny and become its full owner, the server Insider reported this week. Payments for minority stakes started in the second half of September and Chrenek is reported to have paid out over 390 million crowns to minority shareholders. Moravia Steel held more than 90 percent of Třinecké železárny's shares before the beginning of the buyout. The company said earlier the buyout was necessary in order to comply with legal requirements that will take effect as of the beginning of 2014, when the law will demand a clear and verifiable ownership structure of companies for transparency reasons.
Investments into share funds have brought the highest yields to Czechs this year, while bond and money market funds mostly either posted losses or had only small yields, according to a poll the CTK news agency conducted among financial analysts. Interest on deposits in banks and pension funds, state support not included, was often lower than inflation which has been at an average 1.4 percent this year. Investments into gold have not paid off at all, analysts said.
Ministry spends millions on beer drinkability study
The Czech state paid a whopping 5.1 million crowns for a study assessing the "drinkability" of Czech beer, which the Supreme Audit Office recently criticized as a blatant example of the state's ineffective projects, the daily Lidové noviny reported this week. The project was launched in 2008 when the Agriculture Ministry called a tender for working out an optimal method of assessing the “drinkability” of Czech beer. The ambitious project reckoned with researchers spending 13.1 million crowns in five years. They were expected to examine how length of storage and various flavours influence a beer's drinkability, and also to map differences in Czech and foreign-made brews. The ministry scrapped the whole project early, after two years, over researchers' allegedly "serious mistakes," the daily wrote.