Government to sell part of State’s share in Bank of Ireland
DUBLIN: Finance Minister Paschal Donohoe has announced the Government’s intention to sell its shareholding in Bank of Ireland. Minister Donohoe said the Government will sell part of the State’s 13.9% stake in Bank of Ireland over the next six months.
Bank of Ireland’s shares will be sold through a pre-arranged trading plan managed by Citigroup Global Markets. Citigroup was appointed by the Department of Finance’s Panel of Financial Advisors following a mini-tender competition.
Shares cannot be sold for less than a certain price because the taxpayer’s interests must be protected. The Department of Finance will keep this under review. The number of shares sold will depend on market conditions, Mr. Donohoe said.
The Finance Minister said the sale of the shares is a first step towards the gradual withdrawal of the remaining government investment in the Bank of Ireland.
From 2009 to 2011, the Government invested a total of €29.4 billion in AIB, Bank of Ireland and PTSB. Of this, €19.2 billion was fully recovered through disposals, investment income, and liability guarantee fees. The Finance Department said the remaining deposits in the three banks were about €5.3 billion, with a gap of €4.9 billion.
Minister Donohoe said that updates on Ireland’s BOI shareholding will be disclosed to the market. The Minister added that further details related to the scheme could not be disclosed as it would be detrimental to the taxpayer’s value. Upon completion of the process, the number of shares sold, the average price earned and the amount received from the plan will be disclosed.
Bank of Ireland group chief executive Francesca McDonagh said the bank welcomes the Government’s decision. She said it would benefit taxpayers, the Irish economy and the Bank of Ireland.
“Today’s announcement commences a process which will add to the returns already received, and also marks an important moment in normalising the relationship between the Irish State and Bank of Ireland,” Ms. McDonagh added.
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