Saturday 3 December 2016

State seeks bidders for €14bn Anglo-Nationwide loan book

Published 09/02/2011 | 05:00

THE Government began canvassing bidders for Anglo Irish Bank and Irish Nationwide's €14bn deposit book last week and will only consider offers from those who signed non-disclosure agreements by Monday night.

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The Irish Independent has learned that letters went out to all credit institutions "licensed by the Central Bank to take deposits" late last week, advising them of the imminent opportunity to buy the €14bn loan book.

Documents lodged with the courts yesterday show that the "process letter" kicking off the auction will only be sent to parties who have "signed and returned a non-disclosure agreement" by February 7" -- Monday.

The statement effectively rules out any party that did not receive last week's letter, including international private equity firms and EBS bidder Cardinal, which had previously been mooted as a potential buyer for the deposit books.

A spokesman for Cardinal declined to comment. It is understood that several Irish institutions, including Bank of Ireland and Irish Life & Permanent, returned non-disclosure agreements by Monday's deadline and will be issued with the 'process letter' advancing the auction later in the week.

The auction was also opened to several foreign banks that already have deposit-taking operations licensed by the Central Bank here -- it is unclear how many of those have opted to proceed to the next stage.

In an affidavit yesterday, the Department of Finance said it hoped to return to court for a Transfer Order, effecting the deposit handover, "within a period of approximately two weeks".

In statements, Anglo, Nationwide and the Department of Finance stressed that the transfers would have no impact on the interest rates paid to depositors or any of the terms agreed on their accounts.

Bidders

The National Treasury Management Agency (NTMA) last night refused to comment on what kind of "associated assets" would be transferring to the successful bidder with the deposits.

It is understood, however, that the Government hopes bidders will accept NAMA bonds as assets to cover the deposits, which are classed as bank liabilities since they ultimately have to be repaid to savers and companies.

In court documents, the Department of Finance said it hoped the transfer wouldn't trigger any loss for the institutions, but that if it did, the State might have to give further support to Anglo and Irish Nationwide.

The NTMA also refused to be drawn on whether the deposit books would be sold en masse, or whether the State was open to selling them in chunks to different buyers. It is understood that some bidders are interested in taking a slice of the deposit books, rather than the entire €14bn book.

More information will be made available to bidders over the coming days when the NTMA makes an electronic data room open to parties who have signed the 'process letter'.

The data will be guarded by strict confidentiality rules.

Irish Independent

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