DUBLIN May 30 Ireland launched its long-awaited
initial public offering of state-owned Allied Irish Banks
(AIB) on Tuesday, offering a 25 percent stake in what
is set to be one of Europe's largest bank listings since the
2008 financial crisis.
Dublin rescued the bank in a 21 billion euro ($23.50
billion) taxpayer bailout which began in early 2009 and has been
considering partly cashing out of its 99.9 percent stake since
A successful flotation would mark another milestone in a
dramatic turnaround from a banking and fiscal crisis that
wrecked the country's economy a decade ago. The sale could raise
about 3 billion euros taking into account the bank's book value
of 11.3 billion euros at the end of last year.
The bank's value has likely risen since then following
another quarter of margin growth, its payment of a 250 million
euro dividend this month and a further 11 percent uplift in the
value of euro zone banks since the start of the year.
One of Ireland's two dominant banks, AIB returned to profit
three years ago, has cut its huge stock of impaired loans by
more than two-thirds since then and this year became the first
domestic-owned lender to restart dividends since the crash.
"The strong progress made by AIB and current market
conditions mean that now is the right time to commence this
process," Finance Minister Michael Noonan said in a statement
announcing its intention to float.
"Today's decision is a significant step in the continued
normalisation of the state's involvement in Ireland's banking
AIB will list its shares on the Irish and London Stock
Exchange and seek admission to the main markets of each. The
government said the sale was expected to be one of the United
Kingdom's largest main market IPOs of the last 20 years.
AIB management have said they have received "huge interest
in the Irish story" from investors in recent months, pitching
the bank as a rare stock market play focused almost exclusively
on the European Union's fastest growing economy.
AIB is less exposed to Britain's exit from the EU than its
main rival Bank of Ireland, the state's largest bank by
assets, having made just 14 percent of its pre-provision
operating profit in the United Kingdom last year.
It is also the largest provider of mortgages in the
fast-recovering Irish market, with a 36 percent share of the
market by drawdowns, although investors may be wary of a chronic
lack of housing supply that could hold the market back.
The prospectus and price range for the sale are expected to
be published in mid-June, the government said.
Bank of America Merrill Lynch, Davy Stockbrokers
and Deutsche Bank are acting as global coordinators
for the sale. Citigroup, Goldman Sachs, Goodbody
Stockbrokers, JPMorgan and UBS are the
($1 = 0.8936 euros)
(Reporting by Padraic Halpin. Editing by Jane Merriman)