Thursday 18 January 2018

Large share of Anglo loan book will stay with State

Joe Brennan

The STATE may be left with a "large portion" of former Anglo Irish Bank's loans despite interest from sovereign wealth funds, private-equity funds and banks in the first ever sale of Anglo Irish loans, according to Kieran Wallace who is joint liquidator of the failed lender.

Failure to sell enough loans could leave the State with a hole in its finances because Finance Minister Michael Noonan has promised to pay money to NAMA if the sale of the former Anglo's loans fails to raise at least €12.9bn.

The first portfolio, which is now on sale and codenamed Project Evergreen, has a par value of €3.5bn, Mr Wallace said.

Thirteen loans within the portfolio will be sold separately by the liquidators at KPMG. The total loan book for sale has a par value of €22bn.

Mr Noonan ordered the liquidation of the lender in February, and told NAMA to take over unsold loans.

"A large portion will still more than likely go to NAMA, but we're not disappointed by the level of external interest," Mr Wallace said, adding the book has drawn "very significant" interest. "Given the nature of this portfolio, it certainly will be one of the more attractive to external investors."

Indicative bids for the Evergreen loans are due within three weeks, according to Shane McCarthy who is helping run the sale process at KPMG.

Loans to fuel retailer Topaz Energy, broadcaster TV3 and department store operator Arnotts Holdings are earmarked to be auctioned individually.

The liquidators plan to start marketing two other loan books – €7.8bn of mainly UK commercial real-estate assets and €1.8bn of Irish residential mortgages next month.

Mr Wallace said he expects "a number" of borrowers will move to buy out their loans "at par" to avoid them being sold to a third party.

While, Mr Wallace declined to specify how much he expects to raise through loan sales, he said he's rebuffed would-be buyers considering cents-in-the-euro offers.

"We didn't really entertain that," said Mr Wallace. "We were very clear from the beginning that this is not a firesale." (Bloomberg)

Irish Independent

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