Tuesday 24 April 2018

AIB boss says bank is ready for IPO as it makes first bailout repayment

Market sentiment ‘friendly’ to Ireland says Bernard Byrne
Market sentiment ‘friendly’ to Ireland says Bernard Byrne
Peter Flanagan

Peter Flanagan

AIB is ready to be floated on the public markets and it is up to the Government to decide the timing of an IPO, bank chief executive Bernard Byrne has said.

Mr Byrne said market sentiment to Ireland was "very friendly" at present and warned sentiment can turn quickly.

"If it [investor interest] is there, it's always good to take it because sentiment can disappear and appetite can disappear," he said.

But he admitted privatisation may take 10 years.

Mr Byrne was speaking after AIB shareholders backed a capital reorganisation plan that will see the lender repay the first tranche of its bailout funds to the Government. At an Extraordinary General Meeting (EGM) held in the RDS, shareholders voted to support the lender's reorganisation plan, which will see about €1.7bn repaid to the State.

This is the first time the bank has paid money it received as part of its €21bn bailout during the financial crisis.

The EGM was a formality. The Government owns 99.8pc of the bank and had already signalled its support for the plan.

Under the reorganisation, AIB will pay €1.7bn to the State from the partial redemption of preference shares issued to the Government in 2009. As well as this, the maturity of the Contingent Capital Notes in July will see another €1.6bn repaid.

Apart from the repayment plan, shareholders also signed off on a consolidation of AIB shares which sees one new share replace 250 old shares. Chairman Richard Pym said the reorganisation was a crucial step in the bank's recovery.

"These proposals are designed to provide a solid capital base for the company to ensure its future success," he said.

The EGM saw pointed comments from some shareholders, who assailed management for the loss in their shares and criticised the new plan.

Independent Alliance TD Shane Ross demanded the bank have its shares suspended from the Irish Stock Exchange - a move rejected out of hand by Mr Pym.

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