IBRC’s wind-up by end of next year hangs on ‘stabilisation’ of Russia-Ukraine conflict

The planned wind-up of Irish Bank Resolution Corporation (IBRC) by the end of 2024 assumes that there is a “stabilisation” of the Russia-Ukraine conflict in the meantime that allows them to sell assets in both countries, its liquidators have said.

“The effect of the conflict in Ukraine and the Russian sanctions on remaining asset values remains uncertain,” the special liquidators, Kieran Wallace and Eamonn Richardson of Interpath Ireland, said in an IBRC liquidation update report, published on Friday.

“However, the special liquidators continue to monitor and take advice on this position in order to effect an optimum disposal strategies.”

A unit of IBRC owns a six-storey office building in Kyiv and the Univermag shopping mall, also in the Ukrainian capital, which had been estimated to have a combined value of €70 million to €80 million before Russia’s invasion of its western neighbour in February last year.

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The IBRC subsidiary, QIPG Refinance Ltd, also owns a 20-storey Moscow office block, known as Kutuzoff Tower, and a big logistics centre in Kazan, called Q Park, almost 800km east of the Russian capital.

These were estimated to have a combined value of about €100 million before Russia became an economic and financial markets pariah in the West as a result of the war.

The liquidators of IBRC, containing the remnants of Anglo Irish Bank and Irish Nationwide Building Society, were known to be planning before the war started on putting the Russian assets on the market last year.

The liquidators moved two three ago, amid the height of the Covid-19 pandemic, to extend the wind-up by two years to the end of 2024.

The remaining IBRC loan book had a par value of €3.6 billion at the end of last year, including facilities on assets in various jurisdictions that remain with the company due to ongoing litigation.

Some 57 per cent of the remaining loan and asset portfolio is based in Russia and the Czech Republic, 17 per cent in the United States, 8 per cent in Ireland, 12 per cent in Asia and 6 per cent in Ukraine, according to the latest report.

[ End of an era: Central Bank sells remaining IBRC-linked bonds ]

The liquidation work on IBRC transferred from KPMG to Interpath Ireland in May as Mr Wallace and Mr Richardson moved from the Big Four accountancy firm to the new Irish company set up recently by UK-based Interpath Advisory.

The latest report said fees incurred in the liquidation in 2022 were €5.59 million, bringing fees incurred since the beginning of the liquidation in February 2013 to €301.8 million.

The liquidators have previously forecast that total fees before IBRC is wound up will amount to €320.5 million to €324.5 million.