By Max Clarke
A group in investors have announced their intentions to buy €1.123bn in Bank of Ireland shares from the state.
Pending regulatory approval, the move will reduce the taxpayers’ share of the troubled bank and increase its proportion of private ownership to 68%.
“Today’s announcement is truly another very positive development for the Irish economy,” said Ireland’s Minister for Finance, Michael Noonan. “It follows on from the successful conclusion of the Heads of Government summit which saw an agreement to significantly reduce the interest rate on the funds Ireland receives from the EU.”
Continued Noonan: “on March 31, I told the Irish people that our proposed “radical restructuring of the banking system is designed to put the banking system on a firm footing for the future and break the bonds with our toxic banking past.” I said that this was essential for our economy. It was essential for our country. I reiterated, “From here, therefore, we move forward with purpose.”
The commitment by a number of significant private sector investors to invest side by side with the State’s retained holding without any form of additional risk sharing by the State reaffirms the credibility of our stress tests and the health of our banks after the PCAR exercise. It further underlines how we are successfully breaking the link between bank risk and the Sovereign.
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