Dáil Éireann Debate, Tuesday - 6 November 2012
196. 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 that arrangements will be made to ensure borrowers whose loans have been acquired by Lone Star, do not suffer inconvenience or loss. [47280/12]
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 €660 million nominal of loan assets as part of its continuing strategy to meet its non-core de-leveraging targets. The portfolio is primarily comprised of non-core Irish commercial real estate loans originated by EBS Limited.
Communication with affected borrowers has been a priority for the Bank and each Borrower will receive, in addition to verbal notification, a written communication from EBS notifying them of the sale. Subsequent to completion they will also receive further written communication from EBS and separately from Vesta Mortgage Investment setting out the arrangements for the management of their loans going forward. Affected borrowers will continue to remain liable for the full amount of their debt. Their loan terms and conditions remain unchanged and are not impacted by the sale of their loans.
This sale brings AIB’s total net non-core de-leveraging to date to 80% of AIB’s three year PLAR de-leveraging target of €20.5 billion. AIB remains on course to complete the majority of its total 2013 de-leveraging targets by year end 2012 and to achieve this target in line with PCAR capital requirements assumed under the March 2011 exercise.
