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Noonan rejects €500m offer from Gulf investor for stake in AIB


Finance Minister Michael Noonan has welcomed the new PwC report. Photo: Frank McGrath

Finance Minister Michael Noonan has welcomed the new PwC report. Photo: Frank McGrath

Finance Minister Michael Noonan has welcomed the new PwC report. Photo: Frank McGrath

The Government rejected a €500m approach to buy a stake in AIB from a Gulf-based wealth fund without even asking how big a stake they wanted.

In an interview with the Irish Independent, Finance Minister Michael Noonan said the "tentative" approach was made six months ago by an unnamed "sovereign wealth fund".

He also said that top bankers should look to take pride in their work rather than chasing bonuses, and dismissed claims that banks were struggling to keep staff because of the €500,000-a-year pay cap.

Confirmation of an approach for AIB is the first time the Government has revealed receiving solid investor interest in the bank. The approach "wasn't even an offer" but was an indicator that there is interest out there, he said.


However, it was never pursued by the Government, added Mr Noonan, speaking during his trip to New York.

"They said they had half-a-billion available if we were interested in selling them a small amount of AIB shares but we weren't, so we didn't pursue it," Mr Noonan said.

Sovereign wealth funds manage the savings of wealthy countries. The huge funds of oil-rich Gulf states are major global investors. "We weren't interested at the time so we simply said: 'no, there's nothing for sale.' We didn't pursue it.

"We didn't get to the point of even knowing what percentage of share they were even looking for so it was hard to price it, too," he said.

Mr Noonan said shares in all of the remaining bailed-out banks would ultimately be sold either by himself or his successor when it is thought that value is best. The money will be used to cut the national debt.

"We're under no pressure to do it because – in terms of market sentiment – to hold the shares and remind everybody that we have this asset we can realise, is as good as selling it," he said.

Meanwhile, in his latest intervention in the AIB bonuses row, Mr Noonan dismissed claims that banks were struggling to hire or keep staff because of the €500,000-a-year pay cap.

He said there would be no "restoration of bonuses and no negotiations on salary caps" for staff at AIB.

Quashing any speculation the Government might revisit the issue, Mr Noonan insisted the story "seems to have originated in AIB", but he is simply not "prepared to negotiate".

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Rebuffing claims that top banking executives will look for jobs outside the state-controlled financial institutions, he insisted that €500,000-a-year salary was appropriate.

"I don't see any staffing crisis emerging in any of the banks because of pays caps – €500,000 is an awful lot of money," he said.

Mr Noonan added that a pay cheque can't be the only motivation in the job.


"People should have pride in what they do as well. I don't see any necessity to raise the cap. If I get evidence that it's necessary to raise the cap, I'll listen to an argument, but I have no intention of raising the cap at present."

During his four-day US trip, Mr Noonan met with top representatives of Regeneron Pharmaceuticals.

The New York-based company is investing €220m at the former Dell site in Limerick and is set to create 600 construction jobs and 300 hi-tech positions by 2016.

Mr Noonan said he felt that the country was being considered as a place to do business again.

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