Allied Irish Banks (AIB) is on track to raise some required fresh capital through disposals but may struggle to minimise State ownership by selling in an uncertain market, Ireland’s head of banking supervision said.
AIB needs to raise €7.4 billion and plans to sell its UK business, its majority stake in Poland’s Bank Zachodni WBK and a minority stake in MT Bank in the United States.
We are confident AIB is on track to meet its disposal target, the issue is around the valuation of those disposals, Jonathan McMahon, the assistant director general for financial institutions at Ireland’s Central Bank told reporters yesterday.
There is some uncertainty around that at the moment and clearly the amount of government support will in part depend on their ability to realise those assets to the value they think they can, he said.
The Government, which last year nationalised troubled Anglo Irish Bank and has a 36 per cent stake in AIB’s main rival Bank of Ireland, may have to take majority ownership of Allied Irish even if its sells some of it profitable overseas units. – (Reuters)