Monday 26 February 2018

State has no plans to sell stakes in more banks - Donohoe

Paschal Donohoe. Photo: Collins
Paschal Donohoe. Photo: Collins

Gretchen Friemann

Paschal Donohoe, the new Minister for Finance, yesterday insisted the Government has no immediate plans to cut its stakes in Permanent TSB or Bank of Ireland but said exit opportunities are continually under review.

The comments were made in a written response to a Dáil question, and were first reported by Bloomberg.

But Mr Donohoe's remarks are unlikely to quell speculation about the timing of further State selldowns, particularly if Bank of Ireland and PTSB's shares start to strengthen.

Mr Donohoe also ruled out any further reductions this year in its ownership of AIB, which returned to the London and Dublin stock exchanges recently following a €3.4bn initial public offering.

Under the terms of the float, the Government's remaining 71pc stake is held under escrow for at least six months.

Mr Donohoe said that after this period the State "will continue to monitor the performance of the bank, its prospects, its share price and equity markets more broadly to determine the best route to retrieve the optimal return of value for the Irish taxpayer".

While AIB's share price shot up after its float, the deal has weighed on Bank of Ireland's share price, partly because hedge funds shorted the stock as a hedge against their investment on AIB.

But that trade showed little sign of unwinding yesterday as shares in the freshly listed lender shot up by 3pc to €5.10.

Investors unable to gain access to the IPO have piled into the register driving the share price far from its deal price of €4.40.

Irish Independent

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