Friday 19 January 2018

AIB to sell €500m UK loan portfolio

Donal O'Donovan

Donal O'Donovan

State-owned AIB has put a 'for sale' sign on €500m of UK commercial property loans, according to sources close to the sale process.

AIB has hired US banking giant Citigroup to find a buyer, or buyers, for the UK property loan portfolio. The news comes after the same bank put a €675m portfolio of mainly Irish loans on the market through Morgan Stanley in May.

Last night AIB declined to comment on the UK loan sale, but Citi is understood to have made initial approaches to potential bidders in recent days and a full auction process is expected to be launched.

Last year the Central Bank ordered AIB to sell "non-core assets" with a face value of €20bn by the end of 2013, following a review. The bank disposed of €12.7bn of "non-core assets" in 2011, out of the €20bn target. Bank of Ireland was ordered to sell €10bn of assets at the same time.

Meanwhile, NAMA is close to finalising a deal to sell the UK property empire put together by developer Gerry Gannon, according to Savills, the agent for the sale. The portfolio -- dubbed "Project Chrome" -- includes 38 properties estimated to be worth around €120m.

In February UK-based investors Development Securities and Pears were named as potential buyers, but the deal has yet to close.

Last night Savills said that the "Chrome portfolio is under offer and due to exchange imminently".

The news comes a week after Bank of Ireland closed a deal to sell a "€200m" portfolio of UK business loans. It agreed to sell its Infrastructure Project Finance loans to Aviva Special PFI LP, a fund linked to the Aviva insurance giant, at a price of 81 cents in the euro, to bring in €162m for the bank.

Portfolio sales are a major focus for all of the Irish banks.

Earlier this month US investor Kennedy Wilson and Deutsche Bank landed a portfolio of loans sold by Ulster Bank, paying €61m for loans with a face value of €360m.

Irish Independent

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