Sunday 30 April 2017

AIB enters negotiations with potential buyer of €400m Project Cyprus mortgages

Gretchen Friemann

Allied Irish Banks has entered exclusive negotiations with a buyer for a €300-€400 million portfolio of impaired buy-to-let mortgages known as Project Cyprus.

The deal comes as AIB prepares to return to the stock exchange later this year in a near €3bn deal.

It is understood Cerberus, the US opportunist fund, which has hoovered up billions of euros worth of non-performing loans from the National Asset Management Agency over the past few years, is not the buyer.

Project Cyrpus marks the first sizeable sale of toxic residential mortgages in the market and is likely to serve as a barometer for future deals, as rival lenders weigh whether to offload troubled loan books and accelerte efforts clean up thir balance sheets amid increasingly onerous regulatory costs.

As the Irish Independent reported last month, Permanent TSB is expected to finalise a strategy on its €5.9bn book of non-performing loans by mid year, with many in the market predicting it will follow a similar course to AIB and offload a portfolio of buy-to-let mortgages.

It is understood AIB drafted in the accountancy firm,KPMG, to run the Project Cyrpus deal.

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