ANALYSIS:A swift sale of assets should stand to the bank, but finding buyers won't be easy, writes CIARAN HANCOCK

THE OLD adage of first up, best dressed might, in the fullness of time, be applied to the way Bank of Ireland has approached its major restructuring.

Yesterday we were told what Brussels has demanded from Bank of Ireland in return for the State aid it has received. Over the next 10 days we’ll also get sight of its capital-raising plans.

The first tranche of loans has transferred to Nama at a lower discount to that applied to its rivals. For now it appears to have stolen a march on its main rival AIB, which appears to be agonising over asset sales and has been butting heads with the Government over the level of State ownership after its own financial restructuring.

On the surface Bank of Ireland appears to be in better shape than its domestic rivals. Finding buyers for its various assets won’t be easy in the current economic climate but there will be interest.

Irish Life Permanent is already out of the traps expressing an interest to buy New Ireland Assurance and Bank of Ireland Assets Management.

Given its substantial market shares in these sectors, this might prove to be wishful thinking.

New Ireland has €12 billion in life assets and a 19 per cent share of new business in the Republic. It’s a profitable pensions and life company with a healthy market share and should attract offers from both home and abroad, with Aviva and Friends First possibly among them.

The bank believes it is worth about €1 billion.

Finding a buyer for Bank of Ireland Asset Management (BIAM) might be more challenging. It has €25 billion in assets under management but this is less than half the level of earlier this decade and reflects several years of underperformance on its pension mandates, with clients simply moving elsewhere.

In addition, Bank of Ireland’s own pension fund represents a large chunk of BIAM’s business.

Securing a buyer for ICS Building Society will be tricky. Bank of Ireland has committed to selling at least €2 billion from its €7 billion mortgage book.

The problem is that there isn’t huge demand out there for Irish mortgages, particularly broker-sourced business, which is ICS’s main distribution platform.

If anything, international banks want out of Ireland given the depth and scale of the recession.

ICS is also integrated into Bank of Ireland’s wider mortgage operation and spinning it out won’t be easy.

KBC, which offers Irish mortgages through intermediaries, and the UK’s Nationwide Building Society, which has an online presence here, are possible suitors.

With its UK mortgage business also to be wound down, Bank of Ireland’s focus will be on its 250-strong branch network in Ireland, its business banking arm in Britain and its joint venture with the UK Post Office, which it is hugely enthusiastic about.

It will also be shorn of €12 billion in toxic loans, courtesy of Nama, leaving it with a tight business and focus on traditional banking, namely deposit gathering and lending.

Thankfully, it won’t need any more taxpayer cash.

We barely dare to whisper it but Bank of Ireland might be heading in the right direction.