Sunday 23 July 2017

Anglo wants to become 'fund-raising platform'

Emmet Oliver

Anglo Irish Bank can become a "fund-raising platform'' for the entire Irish economy and a key lender to Irish exporting companies, the nationalised lender has claimed to investors.

In an update for bond investors, the bank said Ireland faces a "growing fund gap'' with deposits hard to attract and international banks wary of providing wholesale funding.

Into that gap Anglo can be of some use, suggests the update. "Anglo's funding platform provides the ability to raise retail, corporate and wholesale funding domestically and internationally,'' said the bank in a document sent out to investors in June. In terms of what the bank can offer to industry, the lender said: "Anglo will continue to offer tailored corporate banking services to help Irish companies -- especially key development industries and the export sector.''

Anglo is awaiting a verdict from the EU Commission on its so-called good and bad bank plan, which involves putting its lower quality assets into a new company, called Asset Co.

Another company, Bank Co, will try and offer a commercial lending service for the "unmet needs of clients requiring financing and restructuring solutions''.

The new Asset Co company would try and "maximise'' the asset recovery value from Anglo's lower quality assets.

The management of the bank don't believe liquidation of the bank, or a wind down, would be favourable for the taxpayer.

The split of the bank provides "the best outcome for the taxpayer and creates the best opportunity for the bank to make a contribution towards the wider Irish economic recovery'', they said.

Anglo, whatever happens, will continue to "liquify'' assets, either by selling them to syndicates or by packaging them up and selling them to investors.

An earlier business plan from Anglo in March was met with a cold reception by the EU, forcing the bank to radically recast its plan. The EU is particularly concerned about the amount of property lending Anglo would still be doing even when it split itself into two.

Apart from the EU verdict, Anglo also has significant funding needs in the period ahead. Its own figures suggest it has only raised 34pc of its funding needs for 2010, which is the lowest of the Irish banks. For example, the bank must roll over €7bn of bonds in September.

Irish Independent

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