Sunday 18 March 2018

Ratings firm Moody's commend BOI's actions in closing pension deficit

Bank of Ireland at College Green in Dublin city
Bank of Ireland at College Green in Dublin city
Donal O'Donovan

Donal O'Donovan

Influential rating agency Moody's says Bank of Ireland's deal with unions to close a pension deficit is "credit positive" for the bank.

It is the latest boost for the Irish bank, which is likely to try to tap investors for fresh capital to help repay bailout loans later this year.

In a note to investors Moody's said the deal to cap some pension benefits for retired staff will reduce the pension deficit by approximately €400m, and improve the bank's capital position under tough new "Basel III" banking.

The rules, named after the Swiss city where they were drawn up don’t come into force until 2019, but are increasingly seen as a benchmark by investors.

Shares in Bank of Ireland were up just under half a percent to 25.72 cents each at lunchtime.

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