Bank of Ireland expects discount on bad bank loans transfer
Bank of Ireland expects to receive a 30pc discount on €16bn of loans it transfers to the National Asset Management Agency (NAMA).
Transferring the loans “will bring greater certainty to our remaining loan portfolio,” Chairman Patrick Molloy told a shareholders’ meeting in Dublin today.
“It improves our prospects of raising capital in the future. It will restore confidence.” The 30pc discount is based on a sample of 20pc of loans, Molloy added.
NAMA is buying as much as €80bn of property loans from the country’s banks and said January 7 it expects all of the transactions to be completed by the third quarter of 2010.
Transfer of Bank of Ireland’s loans is expected to be completed by the middle of this year and it will reduce customer loans by as much as €14.6bn, Molloy said.
Bank of Ireland fell as much as 9 euro cents, or 5.6pc, to trade at €1.55 as of 11:49am in Dublin trading.