One third of chief financial officers (CFO) of major Irish-based companies are optimistic about their companies’ financial prospects this year, a survey by Deloitte has found.
This is the highest level of optimism that has been recorded amongst CFOs in over a year. They were not just confident about the performance of their own companies, there was also an increase in net confidence which has more than doubled, up from 7% in Q4 2011 to 17% in Q1 2012.
The survey also shows that CFO sentiment on the performance of the Government is positive with regards to a number of areas. Nearly 80% believe the Government has had a positive impact on encouraging further FDI; a majority believe the Government has had a positive impact on restoring fiscal stability, However, they think more should be done to tackle unemployment. Just 32% believe the Government has had a positive impact on employment and job creation since coming to power.
Deloitte partner Shane Mohan said: “It is positive to see general CFO sentiment at its highest level in a year, and that there’s a very balanced perspective on how the Government is performing. However, Irish CFOs are still feeling the effects of the continuing instability in the eurozone and the subdued economic performance here in Ireland.
“Over half of respondents cited market risk as their most dominant worry. The now omnipresent uncertainty that this is creating remains as much an issue as ever for Irish CFOs.” he said.
Despite an overall increase in confidence, many CFOs felt more pessimistic about the availability of credit to Irish businesses. Nearly twice as many CFOs believe that it is harder to get credit this quarter than last quarter, they also felt that the cost of credit had increased in the first half of 2012.
The number of CFOs favouring domestic Irish banks as their preferred source of funding continued to decline. Last year 53% favoured Irish banks, but in the first quarter of this year only 43% said they would opt for an Irish bank.
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