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IL&P expects over 10 bids for UK loan book

IRISH Life & Permanent is expecting more than 10 bidders to table first-round offers for its £6.8bn (€8.1bn) UK loan book by the end of this week, while a "handful" are set to submit final bids for the sub-prime mortgage book in the coming days.

IL&P is carrying out the ambitious programme of disposals imposed to help meet a €3.8bn capital shortfall identified by last March's stress tests, an outcome that led to a €2.7bn bailout of the PLC.

The sale of the group's €500m Irish sub-prime mortgage business 'Springboard' is the more advanced of the two, with informed sources saying a "handful" of parties had been invited to submit final bids "within the next week".

The process, which attracted a high level of interest, is expected to be concluded in the first quarter of 2011 under the stewardship of advisers KPMG.

KPMG is also handling the sale of the sizeable UK book.

That sales process commenced later, with first bids due by the end of the week, the Irish Independent understands.

A spokesman for IL&P declined to comment.

If the prices secured for the assets generate a capital gain for IL&P, that will reduce the amount of cash the Government has to put in.

Officials are set to agree a new timeframe for bridging the €1.1bn capital shortfall at IL&P with the EC/ECB/IMF troika in January. Allowances for the Springboard and UK sales may be made if the processes are sufficiently advanced.

A sale of Springboard would see about 20 staff move to the business's new owner on their existing terms and conditions.

Indo Business