Allied Irish Banks Share Discussion Threads

[crosswire] 06/11/2009 08:31

AIB sells €750m five-year bond after ratings downgrade

By Joe Brennan


Friday November 06 2009

Allied Irish Banks yesterday sold a €750m five-year bond that is not covered by security or the state guarantee scheme -- but was forced to pay up to ensure the success of the deal in light of another ratings downgrade for Ireland this week.

Fitch cut Ireland's ratings by two notches on Wednesday.

The bond placement follows AIB's sale of €1bn of three-year unsecured and unguaranteed bonds last month. Yesterday's offer was 1.8 times oversubscribed and the bond carries an annual coupon of 5.62pc.

It was priced at 2.85 percentage points over the benchmark 'mid-swap' market rate.

Last month's shorter-dated bond was set at 2.5 percentage points of the benchmark rate.

Colm Doherty, head of AIB's capital markets division, said the latest deal was "a further indicator of the growing positive attitude of the international credit markets towards Irish banks".

Yesterday also saw UBS and Goodbody Stockbrokers upgrade their view on Bank of Ireland shares on mounting signs that the business is stabilising. In a note to clients, UBS said BoI, which reported an almost €1bn underlying interim pre-tax profit on Wednesday, was on track to shrink its loan book to below the €87bn size of its deposits.

This comes as the bank winds down its €32bn, UK broker-sourced mortgage book, €5bn of international corporate loans and transfers €16bn of risky property loans to the National Asset Management Agency.

"These long-dated ambitions would leave a smaller but sustainably-funded group with over €500m of attributable profits by 2014," said UBS analysts, led by John-Paul Crutchley, as they upgraded their stance on the stock to 'neutral' from 'sell'.

Two-thirds of a €1.8bn loan impairment charge for the six months to September was related to property and construction, with loan weakness spreading to other areas of the portfolio, such as small business and mortgage lending as the recession continues.

Goodbody Stockbrokers upgraded the stock to 'add' from 'reduce' on valuation grounds.

But it warned that the stock was "going to remain extremely volatile" as investors awaited clarity on the discount BoI faced on loans going to the 'bad bank', as well as the European Commission's say on its restructuring plan.

[lbo] 05/11/2009 11:24

Ireland Inc losing its competitive edge in slide down league tables

[lbo] 05/11/2009 11:03

Irish Economy: NCB Stockbrokers - - "we are living away beyond our means"

[crosswire] 05/11/2009 06:26

Irish Banks May Raise Capital in Early 2010, Funds Chief Says


By Dara Doyle

Nov. 5 (Bloomberg) -- Ireland's two largest banks may try to raise fresh capital in the first half of 2010 and avoid becoming majority owned by the state, according to the head of a group representing the country's biggest investors.

"I would expect to see a rights issue" by Allied Irish Banks Plc and Bank of Ireland Plc "well supported," Gerry Keenan, chairman of the Irish Association of Investment Managers, said in an interview in Dublin yesterday. "The international view of Ireland Inc. has improved significantly, and the banks-as-rights-issue story is a vote on Ireland."

The lenders may need the money after the government buys real-estate loans from them in an effort to cleanse their balance sheets. While the state already has a 25 percent stake in Allied Irish and Bank of Ireland after investing 7 billion euros ($10.4 billion), Keenan said it's "not inevitable" that the taxpayer will end up with a majority stake.

Ireland was forced to help shore up the two banks and seize a third lender as bad debts surged amid the worst recession in the country's modern history.

Five chief executive officers of Irish banks have resigned since the banking system came close to collapse late last year. Allied Irish is currently searching for a new CEO and Finance Minister Brian Lenihan favors an external appointment.

Newspapers including the Irish Times reported over the past two months that the bank wants to appoint Colm Doherty, the head of its capital markets unit. Allied Irish Chairman Dan O'Connor said last week the lender is having a "good dialogue" with the Finance Ministry on the appointment process.

'Acceptable'

The investment association has a "strong view that it's the job of a board to find a candidate that's acceptable to all stakeholders," Keenan said, adding that the group would "never have a view on a particular candidate."

Allied Irish and Bank of Ireland will hold off on any share sales until the government's plan to buy the loans progresses and the European Union rules on their restructuring plans, said Keenan, whose members manage about 210 billion euros.

While the EU is reviewing bailouts to ensure that banks getting government money don't have an unfair advantage, its judgment may not present problems for Ireland, Keenan said. ING Groep NV of the Netherlands last month agreed to demands that it sell it insurance units to secure approval for a state bailout.

"ING's core banking franchise has remained intact," Keenan said. "If you apply that to Bank of Ireland and Allied Irish Banks, you'd expect the core business to remain intact."

He said the narrowing spread between Irish and German bonds and the ability of the banks to raise funding not covered by the government guarantee indicate new appetite for Irish assets. The yield between the 10-year German bund and the Irish equivalent was at 143 basis points yesterday, half the spread in March.

"Ireland Inc. is back in business," said Keenan.

[lbo] 02/11/2009 12:11

Many investors will be ruing the day they backed AIB's Belfry commercial property funds in Britain, judging by the appalling performance of several of the funds which recently filed their accounts

[lbo] 01/11/2009 09:58

It's one law for bankers, and another for all of us

[lbo] 30/10/2009 21:39

THE forced break-up of Dutch banking giant ING at the behest of the European Union could have "serious consequences" for AIB.

[lbo] 30/10/2009 21:36

Irish banks emerge as Europe's most volatile as bear market returns

[lbo] 28/10/2009 14:14

The latest Irish results from the EU-wide Bank Lending Survey shows that credit to both businesses and to potential home buyers continued to tighten in the third quarter of the year despite massive injections of cash in to Bank of Ireland and AIB.

[hermana] 28/10/2009 10:31

Charlie, shame on greedy phuckers at Davy. Used to have some modicum of decency but alas the current team of barbarians(up to their fat asses in debt after MBO) are squeezing the poor suckers for as much as possible.

[knickers2] 28/10/2009 10:24

NAMA is now a lapdog with no teeth!!!
Functionless and simply an estate agent in whose window
will appear property for sale!!

[knickers2] 28/10/2009 10:23

Obviously Lenihan and the markets now know that they cannot get all party agreement to the capitalisation aspect of their program, and that there will be no more billions from the Government, so the banks will have to raise capital
themselves or go bust and get taken over by the government.

Similarly, the property mountain will be offered by NAMA to the highsets bidder,
and the owners will either have to find new capital or go to the wall.

So the Banks are now worth ZERO and the brokers particularly Davy have put their
investors who had any cash left last month, back into AIB and BOI have phucked up their clients yet again.

Glad I ignored the advice!!!

[lbo] 23/10/2009 09:52

AIB to raise €2bn as part of blueprint for restructuring
Stalemate over appointment of new chief could hamper plans

[hermana] 05/10/2009 22:10

LBO,what about de absolute crock,Anglo?

[lbo] 05/10/2009 21:52

Two major Irish banks have been named as among the neediest in Europe of a major capital injection.

AIB needs an injection of USD 10 billion, the second largest amount of any European bank, according to a new report from JP Morgan Securities.

And Bank of Ireland comes third, with a requirement for USD 7 billion, the report says.

[liarspoker] 05/10/2009 09:59

LBO - feel free to copy and paste relevant articles for Donegal Creameries here:

[lbo] 05/10/2009 09:52

Such is the state of the Irish property market that Bloomberg estimates it will cost British taxpayers more than the war in Afghanistan. According to the financial newswire, Royal Bank of Scotland and Lloyds -- which were both rescued by British taxpayers last year -- injected €3.03bn into their Irish operations during the past 10 months, while British taxpayers spent £2.6bn on military operations in Afghanistan. RBS, which owns Ulster Bank, injected about €1.5bn; while Lloyds, which owns Bank of Scotland (Ireland), spent €1.45bn.

Both banks received a £37bn bailout from the UK exchequer a year ago. According to Vince Cable, economic spokesman for the opposition Liberal Democrat party: "Many will find it hard to understand why British taxpayers are bailing out bad investments made in Ireland." No doubt, however, it is some relief to Irish taxpayers

[knickers2] 02/10/2009 12:36

The Ganly backer and his hedge fund must be having a field day!

[knickers2] 02/10/2009 11:34

I think the middle income bracket will stay away....
and another day the EC and the Irish Government
will finally get the message....

"Give us back our pensions and our jobs first and then
we might consider voting !!!!"