Dáil Éireann Debate, Tuesday - 6 November 2012
195. Deputy Pearse Doherty asked the Minister for Finance further to reports that Allied Irish Banks, in which he is the shareholder of 99.8% of the shares, has sold a portfolio of loans with a nominal value of €675m to Lone Star, if he will confirm the sale price of portfolio; if AIB will book an additional loss on the sale compared with the existing book value of the loans net of provisions, and if so, the quantum of the additional loss. [47279/12]
View answerThe sale of loan portfolios is a commercial matter for the management and the board of the bank. I do not have a role in this function. AIB has informed me that EBS Limited has contracted to sell to Vesta Mortgage Investment Limited, (an affiliate of Lone Star), approximately €660m nominal of loan assets as part of its continuing strategy to meet its non-core deleveraging targets. The portfolio is primarily comprised of non-core Irish commercial real estate loans originated by EBS Limited.
The sale price is a matter of confidentiality between the parties. It is normal course of practice that sales processes are conducted under appropriate confidentiality constraints in order to protect the interests of all parties.
AIB is satisfied that it has maximised value for the bank and its stakeholders as the portfolio was sold following the completion of a comprehensive two stage competitive auction sales process involving a number of credible international investors.
This transaction facilitated the deleveraging of a substantial non-core portfolio and subject to completion of closing conditions is expected to close prior to year end.
This sale brings AIB’s total net non-core deleveraging to date to 80% of AIB’s three year PLAR deleveraging target of €20.5 billion. AIB remains on course to complete the majority of its total 2013 deleveraging targets by year end 2012 and to achieve this target in line with PCAR capital requirements assumed under the March 2011 exercise.
