Bad timing just not funny at Bank of Ireland
Published 24/10/2010 | 05:00
DESPITE many superficial differences, comedy and investment share one common characteristic: timing is everything.
Friday's announcement from Bank of Ireland that it had sold Bank of Ireland Asset Management to US giant State Street for a mere €57m demonstrates just how much Bank of Ireland's failure to offload its fund management arm at the top of the market has cost shareholders dear.
Way back in 2004 BIAM was the jewel in BoI's crown, with €57bn of assets under management and profits of €125m. Analysts confidently asserted that it had a value of €1bn or more. Indeed, such was the prestige attached to BIAM, that it served as the springboard for Brian Goggin's ascent to BoI.
Goggin was lucky to get out when he did. Shortly after his promotion four of BIAM's top fund managers jumped ship. This was followed by a string of client defections. Today it has just €25bn of funds under management, less than half of what it had in the middle of the last decade.
The bank has been trying to sell BIAM for more than three years but there were few takers. Instead, State Street, the US investment group that already employs more than 2,000 people in Ireland, confident that it was the only show in town, bided its time. Will the Americans' timing prove to be better than that of Bank of Ireland?